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CHEYENNE, Wyo.—A businessman behind a proposal to build a 500-mile pipeline to carry water from southwestern Wyoming to Colorado’s Front Range said Thursday he wasn’t giving up, despite another setback in seeking federal permission for the plan.

Fort Collins businessman Aaron Million said he will resubmit his proposal in a couple of weeks to the Federal Energy Regulatory Commission.

“We’ll get this issue rectified with FERC and get on with it,” Million said in a telephone interview.

Opponents of the proposal, which include the state of Wyoming, hope any subsequent applications meet the same demise.

“FERC is still going to have to consider public comment, and I think maybe this guy’s not listening to what people are trying to tell him,” Green River Mayor Hank Castillon said.

The commission on Thursday issued an order through Jeff Wright, director of FERC’s office of energy projects, saying Million’s application was premature and lacked specifics about the proposed pipeline.

Opponents hailed the decision while Million downplayed its significance.

Million envisions drawing up to 250,000 acre-feet of water a year from Flaming Gorge Reservoir on the Wyoming-Utah border and piping it as far south as Pueblo, Colo. He has said the pipeline would help Colorado and Wyoming use some of their share of water in the Colorado River system that otherwise would flow to other states.

The state of Wyoming, local governments and various groups have opposed the plan, worrying it would draw down Flaming Gorge Reservoir, which is fed mainly by the Green River. They maintain recreation, the local economy and the environment would all be hurt.

“This is a pipeline that’s going to devastate the Green River,” said McCrystie Adams, staff attorney for Earthjustice.

Million initially asked the U.S. Army Corps of Engineers to review his plan. After working on the project for two years, the corps stopped its review last year after Million announced his project could generate hydropower.

Million then filed an application with FERC spelling out plans to construct a system of turbines and reservoirs along the pipeline to generate electricity. He has said the project wouldn’t generate more electricity than would be consumed by pumping the water. However, generating the power would help cover pumping costs, he said.

Million maintains his project is similar to the proposed Lake Powell Pipeline Project, for which FERC is also the permitting agency. That project involves a proposed $1 billion pipeline that would carry 100,000 acre-feet of water a year to southern Utah, generating electricity as the water flows downhill in places.

Steve Jones, watershed protection program attorney with the Wyoming Outdoor Council in Lander, said the “hydropower part of this project was more sort of a subterfuge than anything else” in order for Million to avoid going through the Army Corps of Engineers.

Wyoming Gov. Matt Mead also questioned whether FERC was the proper agency to handle the permitting.

Thursday’s FERC order did not specifically say it was not the proper agency to review the project, but it noted that it could not properly consider Million’s application because no pipeline exists and there was no information from Million about seeking authorization for a pipeline.

Million said he needed to provide more information to FERC to clear up the matter.

The project includes constructing a reservoir on the slopes of Sheep Mountain, west of Laramie, and generating electricity by pumping water into the reservoir and having it flow through turbines on its way downstream to another lake nearby, Lake Hattie.

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