WASHINGTON (AP) - The U.S. Supreme Court on Monday rejected an appeal from a pipeline company over denial of environmental permits for a proposed natural-gas pipeline through Long Island Sound.

Connecticut regulators refused to issue permits for the 50-mile project to Islander East Pipeline Co. LLC, saying it would damage water quality, natural resources and prime shellfish beds.

Islander East, based in Cheshire, Conn., needs Connecticut water-quality permits to secure federal approvals for the pipeline, which would link the state to the eastern end of Long Island in New York.

Long Island's Suffolk County called the project a "cost-effective and energy-efficient way to deliver much needed natural gas to the Connecticut, Long Island and New York City markets."

Islander East is now considering its options, including the possibility of revising the project with a different route, a company spokeswoman said. Islander East is a venture of Houston-based Spectra Energy and KeySpan Energy, which was acquired by Waltham, Mass.-based National Grid last year.

"Obviously it's disappointing for us," said Toni Beck, Spectra Energy's group vice president for internal and external affairs.

Connecticut Attorney General Richard Blumenthal said the high court's decision effectively kills the project.

"This sweeping victory is the death knell for this hugely destructive project, dealing it the demise it so richly deserves," Blumenthal said. "We fought long and hard to finally triumph over selfish corporate interests seeking to despoil Long Island Sound."

Blumenthal said the pipeline would have harmed environmentally sensitive areas, including the Thimble Islands off the Branford coastline.

"This immensely invasive, intrusive pipeline was worst place and worst case for Long Island Sound and its fragile environment," he said.

The 2nd U.S. Circuit Court of Appeals ruled against Islander East last May, allowing Connecticut regulators' denial of the environmental permits to stand. The Supreme Court declined to hear Islander East's appeal without comment Friday.

Connecticut Gov. M. Jodi Rell said Monday that while the state and region need reliable energy sources, "We can - and must - find ways to meet our energy needs without sacrificing unique and precious natural resources like Long Island Sound."

Rell noted that the state has also been successful in fighting a huge liquefied natural gas terminal proposed for Long Island Sound by Broadwater Energy, although the company is appealing Connecticut and New York's rejection of the project.

"First Broadwater. Now Islander East. With today's Supreme Court announcement, we have succeeded in turning back two ill-conceived energy projects that would have caused irreparable harm to Long Island Sound," Rell said.

The case is Islander East Pipeline Co. v. McCarthy, 08-367.