A company says it plans to drill for natural gas near the site of an underground nuclear blast nearly four decades ago, despite opposition from local residents and the concerns of Energy Department (search) officials.

Presco Inc., based in the Houston area, had received permission from county commissioners to drill one well inside a state-imposed buffer zone around Project Rulison (search) in western Colorado.

Project Rulison was part of a federal project to explore peaceful uses for nuclear devices. The Atomic Energy Commission (search) detonated a 43-kiloton bomb at the site in 1969 to free gas below the surface.

But local officials withdrew their support of Presco's drilling project this week after learning that Presco planned to drill four wells inside the buffer zone.

That decision prompted the state agency that issues drilling permits to cancel plans to consider a rule change that would have allowed the company to drill inside the buffer zone if the bottom of the well is outside the prohibited area.

Tresi Haupt, the only commissioner who opposed allowing the company one well in the buffer zone, said she believes there should be no drilling inside the zone until the Department of Energy determines it is safe.

"I don't understand why they feel the need to drill in this location until everyone has cleared it," she said.

The state has asked Presco to revise its application or submit a new one because of the county's concerns, Beaver said. The commission then will schedule a hearing on the concerns of officials and residents.

"Our intent is to develop the area to the extent that it's safe and reasonable to do so," said Dave Wheeler, Presco executive vice president.

The DOE expects to complete a study by the fall of 2007 examining whether radioactive gas or other material is spreading underground. Pete Sanders, the agency's manager of the site, said that while the DOE can provide that data, the state decides whether or not to permit drilling.

Still, "we would be more comfortable if drilling didn't take place until we're done with our study," he said.

After the 1969 nuclear blast, the gas was considered too radioactive to be sold commercially. The Department of Energy — the Atomic Energy Commission's successor — began deactivating and cleaning the surface of the site in the 1970s, finishing in 1998.

Monitoring has not found any increase in radioactivity in surface or groundwater above normally occurring levels, a DOE report released in January found. Sanders, the site manager, said officials must determine whether radioactivity is spreading underground.

Garfield County (search), which is experiencing a boom in natural gas drilling, projected that allowing Presco to operate the one well inside the buffer zone would have provided some of that information.

"No one realized they were talking about four wells," said county administrator Ed Green.