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ALBANY, N.Y. (AP) — New York regulators have denied a permit for a pipeline expansion designed to increase natural gas deliveries to New York City.

The Northeast Supply Enhancement project proposes to expand the Transco pipeline, which extends from Texas to the Northeast coast. It would include installation of 17 miles of 26-inch-diameter underwater pipeline from New Jersey to Queens.

The Department of Environmental Conservation says Friday the application for a state water quality permit shows “potentially significant environmental impacts.”

A spokesman for Tulsa, Oklahoma-based Williams Partners says the company intends to resubmit its application and work with DEC to satisfy conditions for permit approval.

Food and Water Watch, an environmental group, says it will continue to fight the pipeline and other fossil fuel infrastructure.