08/09/2012 01:34 EDT | Updated 10/09/2012 05:12 EDT

Nova Scotia extends permit to allow exploration oil well in Cape Breton

HALIFAX - Petroworth Resources Inc. has been granted a one-year extension to its permit allowing the company to drill an exploration oil well in Cape Breton.

The province's Energy Department announced today that it gave the extension following a Nova Scotia Supreme Court ruling Wednesday that rejected a bid by a citizens group to overturn the permit.

The permit allows the company to drill an exploration well near Lake Ainslie, Cape Breton's largest freshwater lake.

The Margaree Environmental Association launched a judicial appeal trying to quash the permit, arguing that the provincial environment minister was wrong to approve it because the proposed well would be too close to a stream that feeds Lake Ainslie.

But the court concluded that the minister acted fairly and the group was not denied an opportunity to voice its concerns.

The extension is retroactive to July 15.