TransCanada has heeded the Quebec government's request for a deeper review of Energy East, agreeing to provide more detailed information about the pipeline project.
Environment Minister David Heurtel says the Calgary-based company filed paperwork as required under Quebec's Environment Quality Act and will have to produce an impact study by June 6.
Friday's announcement also puts on hold a review process conducted by Quebec's environmental review agency.
A second round of Energy East public hearings that was scheduled to begin Monday was postponed by Heurtel with a statement thanking participants for their contributions.
The first hearings before the BAPE (the French-language acronym for the environment review body) wrapped up in March with citizens from across the province grilling TransCanada (TSX:TRP) executives on the risks and costs associated with the pipeline.
Energy East would bring 1.1 million barrels of oil a day from Alberta and Saskatchewan through Quebec and into News Brunswick for overseas shipping.
The 4,600-kilometre project includes existing TransCanada pipeline as far east as Montreal, plus new pipeline to be constructed through Quebec.
The project has run into stiff opposition in Quebec, with politicians, citizens and ecologists questioning whether the environmental risks outweigh the economic rewards.
Friday's agreement could end an impending legal fight between the two: the province had filed an injunction to force TransCanada to be subjected to the more rigorous review process.
Other environmental groups who were also asking for an injunction were lumped in with the province's request.
Quebec said it is committed to withdrawing the application upon approval of the environmental impact study.
Both TransCanada and the provincial government have pledged to respect a strict timetable.
Company spokesman Tim Duboyce says TransCanada and the province looked for a mutually acceptable path forward — and the assessment was what both sides agreed to.
"This is an addition to the comprehensive environmental review completed by the federal regulator, the National Energy Board," Duboyce noted in an email.
Duboyce called it a positive development that will address Quebec's wish for more information while ensuring the NEB regulatory process won't be unduly delayed.
Pipelines that cross provincial boundaries are subject to a federal environmental review process administered by the NEB.
Provinces conduct their own reviews to help come to a position that are considered by the NEB before it makes a recommendation.
The federal cabinet makes the final decision.
Proponents of the project say the pipeline is vital to the development of Alberta's oilsands, improving the country's GDP and creating the money needed to transition to a lower-carbon economy.
Opponents have countered the pipeline will increase Canada's greenhouse gas emissions and prevent the country from meeting its climate-change commitments.
TransCanada maintains that pipelines are safer and more environmentally friendly than other options for transporting oil.
The cost of the pipeline is estimated at $15.7 billion, which doesn't count the existing pipeline assets that will be converted for use in Energy East, hopefully by 2020.