LONDON (CP) - A Canadian company's plans for a dam in Belize has been given the go-ahead by the British Privy Council, ending a legal battle by conservation groups that wanted new environmental impact hearings on the project.

In a split 3-2 judgment, a judicial committee of the council ruled that the
environmental impact assessment done by regulatory authorities in Belize was sufficient to support construction of the dam.

For Fortis Inc. of St. John's, Nfld., the decision means construction on
the Chalillo Dam on the Macal River can steam ahead with the project's
completion now forecast for mid-2005.

"This is the eighth or ninth time that this has been before the courts, and each time it's been given a green light," said John Evans, chief engineer at Fortis and vice-president of Belize Electric Co. Ltd., a subsidiary of the Canadian company.

Some work on the site has already begun, "but with this news we can ramp up activities and move forward," he said.

The dam has been approved by local environmental protection agencies, but the Belize Association of Non-Governmental Organizations (BACONGO) argued the plans for the hydroelectric project are flawed.

BACONGO believes the dam's approval was granted on plans that showed it would be built on granite, but geological surveys indicate the site chosen for the dam consists of sandstone and shale, raising questions about its safety.

The company conceded that bedrock was originally misidentified as
 granite, but it says the sandstone at the site can support the dam.

In its judgment, the Privy Council said it accepts that the geological surveys done for the dam show it can be safely built.

"Their lordships . . . do not consider that the geological error in the EIA
(environmental impact assessment) was of such significance" to
overturn decisions made in Belize, the majority judgment read.

The environmental coalition said it will continue to campaign against
the project in Belize.

"This is a setback, but we won't stop until we get the truth about this
project," said Tony Garel, chairman of BACONGO. "This project will
unravel when the full truth comes out."

Evans said the court cases have delayed the project by more than a
year.

"While the delay in construction costs us money, I think more
importantly it costs the people of Belize money because they've had to buy energy at a higher price," he added.

Evans said Fortis never considered abandoning the project.

"I think there were times when we were very frustrated, but there
comes a time when you have to do what you think is right for the
people that you're serving," he said.

The environmental groups also argued that the $40-million Cdn project
would damage surrounding rainforest that has been left untouched by
humans for 500 years and destroy the habitat of threatened species,
including jaguar, tapir and scarlet macaws.

The Privy Council, which serves as the final court of appeal for Belize,
also rejected the groups' archeological and conservation arguments.

The Belizean government said the project is fundamental to the country's economic development. It currently gets about half of its electricity from neighbouring Mexico.

Fortis is a holding company that operates seven electric companies in Newfoundland, Prince Edward Island, Ontario, the Cayman Islands and
New York. Its wholly owned subsidiary, Fortis Properties, owns hotels,
office buildings and malls throughout Atlantic Canada.

© Copyright 2004 The Canadian Press