The state Department of Natural Resources has granted the first of three state permits for the proposed expansion of an underground natural gas storage operation in the salt dome under Lake Peigneur in Iberia Parish.

AGL Resources, of Atlanta, is proposing to scour out two new salt caverns for its Jefferson Island Storage & Hub facility, where two existing caverns have been used for gas storage since the 1990s.

The proposed expansion has drawn opposition from residents living around the lake, several public officials in the area and environmental groups.

“We are going to continue to fight until the end,” Save Lake Peigneur President Nara Crowley said Tuesday. “They shouldn’t even think about granting a permit, based on what’s going on in Assumption Parish and what we have going on in the lake.”

Crowley and other opponents repeatedly have raised the issue of the large sinkhole in Assumption Parish that is tied to a collapsed salt cavern, arguing state regulators should take a close look at any new salt cavern storage permits.

They also said unexplained bubbling has been documented at Lake Peigneur in recent years.

Strange bubbling had been reported in the Bayou Corne area before the sinkhole developed there.

As recently as last month, agents with DNR traveled to Lake Peigneur to investigate reports of long lines of bubbles on the lake’s surface but reached no conclusions on the cause.

The permit granted by DNR last week is for dredging work that needs to be done in order to bring equipment into Lake Peigneur for the expansion project.

AGL still needs two additional permits, one to scour out caverns in the salt dome and another to store natural gas in the new caverns.

The company cannot begin the dredging work needed to bring equipment into the lake until the other permits have been approved, according to permit approval documents mailed by DNR this week to interested parties.

Many of the comments made at a public hearing last month on the dredging permit focused on safety and environmental concerns related to the main cavern project. DNR officials stated in the permit approval documents that those questions will be addressed when the other two permits are considered.

Opponents of the dredging permit have raised concerns about how dredging could affect water quality at the scenic lake, but DNR officials responded that impacts are expected to be minimal.

AGL has maintained the company has done all the necessary research for a safe expansion of the gas storage facility and has pointed to a record of no problems since the initial two caverns began operating in the 1990s.

The proposed expansion of AGL’s Lake Peigneur operation has been on hold since 2006, when then-Gov. Kathleen Blanco called for an extensive environmental study of the project.

AGL responded with a lawsuit against the state, and the case ended with a settlement in 2009 that called for additional safeguards but not the environmental study.

State Sen. Fred Mills, R-Parks, unsuccessfully pushed legislation last year to require extensive environmental impact studies for some salt cavern storage projects and said he plans to re-urge the legislation in the upcoming session.

“I did have several legislators say we would like to look at this again, in light of Bayou Corne,” Mills said earlier this month.