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A federal appeals court on Thursday upheld a judge’s ruling overturning a federal agency’s approval of Toronto-based Hudbay Minerals Inc.’s plan for a new open-pit copper mine in southeastern Arizona.

The 9th U.S. Circuit Court of Appeals agreed that the U.S. Forest Service’s approval of a permit for the Rosemont Mine project in a valley on the eastern flank of the Santa Rita Mountains near Tucson went beyond what is allowed under a federal mining law.

The appellate court cited the planned use of Coronado National Forest land for long-term storage of waste rock, not actual mining, and the lack of valuable minerals on that property.

Hudbay Minerals officials said in a statement Thursday they were reviewing the ruling and would continue to pursue alternative plans for mining part of the Rosemont copper deposit on nearby private lands.

A coalition of environmental and tribal groups challenging the mining hailed the appellate court’s decision, the latest in a series of legal obstacles to the project.

“This momentous decision makes it clear that Hudbay’s plan to destroy the beautiful Rosemont Valley is not only a terrible idea, it’s illegal,” said Allison Melton, an attorney at the Center for Biological Diversity.

Hudbay has another mine project in the works on the western flank of the Santa Ritas.

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