The Nova Scotia government has halted part of the construction work on the $100-million Alton Natural Gas Storage Project until Calgary-based AltaGas carries out further consultation with the Mi'kmaq, CBC News has learned.

Nova Scotia is enforcing the consultation by withholding provincial permits. The bureaucratic time out was revealed Wednesday at a seminar on aboriginal environmental consultation in Halifax.

"We have altered timelines... to accommodate further consultation," says Peter Geddes of Nova Scotia Environment.

The Assembly of Mi'kmaq Chiefs demanded a halt to the project last week claiming its concerns over the project's impact on fish have not a been addressed.

"The commitment we've heard is there won't be any further permits or approvals delivered on this particular project until meaningful and adequate consultation has happened," says Twila Gaudet, consultation liason for the Mi'kmaq Rights Initiative.

On Wednesday officials with the Department of Environment, the Nova Scotia Office of Aboriginal Affairs and AltaGas confirmed that permits are being withheld.

AltaGas plans to drill into large underground salt caverns to store natural gas near Stewiacke, N.S. It will flush large quantities of salty water generated during the construction process out with the falling tides at the confluence of the Shubenacadie and Stewiacke rivers.

The project received its required environmental assessment in 2007. Construction work to breach a dyke — which was part of the original approvals — has been halted because Nova Scotia Environment has refused to issue a permit. The drill site is still active.

Premier Stephen McNeil says his government is arranging a meeting between AltaGas and the Mi'kmaq in the expectation common ground will be found.

"But listen, there is a responsibility in this province to consult and we're going to continue to consult until our partners are happy," McNeil told CBC News.

AltaGas allowed CBC on site Wednesday, but declined comment.

Nova Scotia's decision to halt the project threatens construction timelines and raises questions about when a company with a seven-year-old environmental assessment can expect to clear regulatory hurdles.

Bureaucrats said Wednesday in Halifax that securing an environmental assessment does not end a proponent's requirement to consult. 

The Mi'kmaq agree.

"The EA isn't the end of it. There is still a lot more needed," says Gaudet. "The consultation process supersedes that."