A three-judge federal appeals court panel denied a request to block the project until an appeal by a coalition of environmental groups and the State of New Jersey can be heard.

Critics accused the Army Corps of Engineers of violating federal and state environmental laws as well as the corps' own rules in pressing ahead with a proposal to deepen the 102-mile channel to 45 feet from its current 40-foot depth between Camden and the Atlantic Ocean.

The Delaware Riverkeeper Network and other groups asked the appeals court to intervene earlier this month after a federal judge refused to delay the first 12-mile stretch of deepening near Wilmington. In the same order, however, U.S. District Court Judge Sue L. Robinson blocked work on the remaining 90 miles pending a Delaware state permit review.

"I think this is obviously significant in terms of the project continuing to move forward," said Dennis Rochford, president of the Maritime Exchange for the Delaware River and Bay. "The start of the dredging sends a very strong signal to the shipping industry, the maritime industries" that local ports are taking steps to remain competitive with other Atlantic shipping centers.

Other challenges to the deepening are continuing both in the appeals court and in two federal court cases in New Jersey, said Maya K. van Rossum, who directs the Delaware Riverkeeper group.

"To move forward with this project knowing they may never finish it is absolutely, fundamentally irresponsible," she said. "They know full well that there are very meaningful legal challenges that have been brought against this project, arguing issues of federal law, state law and even issues with a constitutional flavor."

National Wildlife Federation

Corps spokesman Edward Voigt said on Wednesday that work could start as early as Friday along the river near the Chesapeake and Delaware Canal, although there was "no guarantee." The first segment of the deepening extends from the Delaware Memorial Bridge south to the canal.

Late last year, federal officials declared Delaware had unjustifiably delayed permit decisions on the case and invoked what they said was federal authority to overrule state environmental laws in order to "maintain navigation" on the nation's waterways.

Critics sued, saying the corps overstepped its bounds, potentially setting a bad national precedent. They argued in their appeal that Robinson's split decision favoring the corps was inappropriate and incorrectly put federal and private interests above states' rights.

Every aspect of the plan triggered complaints. Environmental groups charged that the corps should have updated its last environmental report, completed in 1997, and said the agency was using outdated and inadequate testing of toxic compounds in river bottom sediments. New Jersey challenged federal efforts to evaluate and protect fisheries, aquatic habitats and wildlife, and accused the corps of neglecting risks from dredge spoil disposal sites that the state said could drain toxic chemicals into underlying aquifers and the river.

Delaware rejected a corps permit for work in state waters in July, saying the project and river environment had changed since the agency applied for approval in 2001.

Third Circuit Chief Judge Anthony J. Scirica, Judge Julio M. Fuentes and Thomas M. Hardiman issued the ruling Wednesday. The judges said that challengers failed to show a likelihood of success, or irreparable harm or damage to public interests by letting the dredging go forward during the appeal.