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UPDATE 1-U.S. court vacates Dominion Atlantic Coast natgas pipe permit

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July 26 (Reuters) - A U.S. appeals court on Friday vacated a permit by the U.S. Fish and Wildlife Service that allowed Dominion Energy Inc to build its Atlantic Coast natural gas pipeline from West Virginia to North Carolina in areas inhabited by threatened or endangered species.

Dominion suspended construction of the long-delayed project in early December after the 4th U.S. Circuit Court of Appeals in Richmond, Virginia, stayed the Fish and Wildlife Service's permit, called an incidental take statement.

The court on Friday found the Fish and Wildlife Service "fast-tracked" its decision to reissue an incidental take statement in 2018 a mere 19 days after federal energy regulators resumed formal consultation with the agency following the court's decision to stay a version of the permit from 2017, Fourth Circuit Chief Judge Roger Gregory said in the court's opinion.

"In fast-tracking its decisions, the agency appears to have lost sight of its mandate under the (Endangered Species Act)," Gregory said, noting the Fish and Wildlife Service's decisions in granting the 2018 incidental take statement were "arbitrary and capricious."

Officials at Dominion were not immediately available for comment but in the past have said the company hopes to overcome this and other legal challenges that will allow it to resume construction of the $7.0-$7.5 billion pipeline later this year and complete it by the end of 2021.

When Dominion started work on the 600-mile pipe in the spring of 2018, the company estimated it would cost $6.0-$6.5 billion and be completed in late 2019.

(Reporting by Scott DiSavino; editing by Jonathan Oatis and Bill Trott)