Environment authorities in the Cook Islands have rejected a proposal to build a fuel pipeline crossing the reef around Rarotonga.
The Rarotonga Environment Authority has declined the proposal to construct a fuel tanker mooring and pipeline in Nikao saying the environmental risks of the project were significant.
The developers, Petrocean, have said the proposal could offer lower fuel costs but many Rarotonga residents have made submissions against the plan.
The Authority says a major spillage would hurt the surrounding reef and lagoon ecology, public health and the economy which is reliant on tourism.
They say there is no guarantee the project would result in lower fuel costs.
It also said the project was inconsistent with the government's commitment to renewable energy.
Nikao-Panama was a well-known fishing area and any fuel spillage there would affect the livelihood of locals, who were dependent on seafood from the area, the REA said.
The REA noted the Ports Authority had limited capacity and resources to manage and respond to disasters such as oil spills and fire, both within and outside the harbour.
It is understood the developers are appealing the decision.
Under the proposal, a tanker which routinely passes by the Cook Islands to deliver fuel to Tahiti, could potentially stop at Rarotonga to deliver fuel for the local market.