A state panel has approved the nation’s first commercial oil sands project, located in eastern Utah’s Book Cliffs. But opponents of the project say they will likely challenge the ruling in court.

The Utah Water Quality Board voted 9-2 last week to uphold the state Division of Water Quality’s decision allowing the 212-acre PR Spring project to proceed. The board did not require a groundwater pollution permit, indicating the area’s groundwater is too deep to be affected by runoff.

The decision confirms “substantial evidence” that no shallow groundwater exists in the area and that the project would have “insignificant” effect on any potential groundwater, U.S. Oil Sands CEO Cameron Todd said.

“The decision also highlights the outstanding environmental attributes of U.S. Oil Sands’ extraction process, which uses only a non-toxic bio-solvent derived from citrus to remove oil from the sands,” he said. “Our process uses no tailings ponds and recycles 95 percent of its water.”

Todd said the ruling “illustrates the merits that our responsible approach to oil sands development has for the environment and local communities.”

U.S. Oil Sands doesn’t fear a possible court fight, he said. Rather, Todd said he welcomes a thorough review that shows the company has the highest industry and environmental standards.

An attorney representing Western Resource Advocates and legal ally Living Rivers of Moab said it is “highly likely” they will file a motion with the Utah Court of Appeals to stop the project.

“We disagree with the Water Quality Board’s characterization of Utah law as it applies to this permit and how they classify groundwater,” said Rob Dubuc. “This decision goes against clear evidence, already in the record, that there is groundwater at the mine site.”

Opponents of the project argued that groundwater in the area would be polluted if oil extraction proceeds.

“The whole place is surrounded by groundwater,” said John Weisheit, conservation director for the Moab-based Living Rivers. “It’s there.”

He added that oil exploration also would “destroy the herds of deer and elk up there.”

Dubuc agreed, saying the decision “could have a lasting effect on the hunting and recreation economy in Utah.”

The Utah Board of Oil, Gas and Mining (UDOGM) still must give final approval, but Dubuc said chances that UDOGM will reverse the water board’s decision are virtually nil.

“This is pretty much the final decision,” he said.

There will be a 30-day comment period after the water board officially issues its written opinion. Dubuc could not say how quickly opponents would seek court intervention, but added, “I don’t imagine it will take very long.”

U.S. Oil Sands, which is based in Calgary, Alberta, has been pushing PR Springs since 2005. The company says the site will produce 2,000 barrels of oil each day. Company officials have said production is expected to begin in late 2013.

The company received Utah state approval for a groundwater discharge permit in 2008, and a large mine permit for oil sands development in 2009. A challenge was filed in 2011 after U.S. Oil Sands requested a modification of the permitted project. Utah Administrative Law Judge Sandra Allen ruled in favor of the company in May and made her recommendation to the Water Quality Board.