Allen Benson, an Energy Department spokesman for the Yucca Mountain Project, wouldn't comment on whether his agency would continue to use the state's water for drilling at the site, 100 miles northwest of Las Vegas. The issue, he said, is a matter of litigation.

"The department has issued the response to the state's letter and the next move is up to the state," Benson said.

The rejection letter Friday to Nevada Deputy Attorney General Michael Wolz from Keith E. Saxe, assistant chief of the Justice Department's Natural Resources Section, asserts that the DOE's effort to use the water to drill bore holes for collecting geologic samples is the desire of Congress and the state engineer's limitations on use of the water "are unacceptable."

"The state engineer's time-limited agreement would provide insufficient water to properly complete the drilling program and would impose other limits and conditions on DOE's ability to implement congressional mandates," Saxe wrote.

He said the state engineer's "demand is especially odious because it includes a threat to impose penalties and injunctive relief."

Adams, on the other hand, said the federal government's argument that DOE "is required to conduct the drilling program is disingenuous."

Accepting the state engineer's terms would have allowed the drilling project to continue for another 30 days, enough time for DOE to finish the last 44 of some 80 bore holes needed to geologic samples and seismic data for a license application.

After that, no water could be used for drilling because it is not in the state's interest. Failing to abide by the terms would mean DOE could face penalties of up to $10,000 per day per violation under a state law that doesn't take effect, however, until January 2009.

Bob Loux, executive director of Nevada's Nuclear Projects Agency and a longtime critic of the Yucca Mountain Project, said it stands to reason by Friday's development that "either DOE has already collected all the data they need or they wanted to get in court so they could collect data in the future."

Meanwhile in a teleconference call from her campaign in Iowa, Democratic presidential hopeful Hillary Clinton called for congressional hearings to air concerns for the project going forward without a radiation safety standard from the Environmental Protection Agency.

She said she will use her position as a New York senator on the Environment and Public Works Committee to slow the project down and put the Department of Energy's license application on hold until she is conceivably elected president.

At that point, she said, "As president, I will not go forward with Yucca Mountain. My administration will not proceed with Yucca Mountain.

"I will try to do what I can in the next 18 months as senator. If we don't try to slow it down now ... it could become fait accompli," Clinton said.

A two-tiered standard covering periods of 10,000 and 1 million years has been proposed but not finalized by the EPA.

Department of Energy scientists have continued to prepare licensing documents for submitting to the Nuclear Regulatory Commission including designs for surface facilities to age, or cool, spent nuclear fuel assemblies and a repository to hold 77,000 tons of highly radioactive waste.

In 2002, Clinton voted against designating Yucca Mountain as the nation's site for highly radioactive waste.

Nevertheless, John Hambrick, chairman of the Clark County Republican Party, described Clinton as "a Hillary come lately" in the Yucca Mountain debate.

Hambrick said, however, "I'm very pleased that she is agreeing with the positions of (Rep.) Jon Porter, Senator (John) Ensign and Senator (Harry) Reid. I'm very glad she's on board with the Nevada delegation."

Reid, D-Nev., the Senate majority leader, and Ensign, R-Nev., have been steadfast in their opposition to the Yucca Mountain Project.

Also on Friday, Ward Sproat, the nation's civilian radioactive waste chief, was in Las Vegas to meet with representatives of affected governments including the group's newest member, Joe Kennedy, chairman of the Timbisha Shoshone tribe and a critic of the nuclear waste repository.

Sproat said after the meeting that "this point of the project is very intense."

He said he expects the massive license application and supporting documents to be "in my hands to sign in March or early April."

His goal is to submit the application to the NRC no later than June 30 next year.

Elsewhere, former Sen. Richard Bryan on Friday called for a meeting between Gov. Jim Gibbons and Nevada's federal lawmakers to show that state leaders are not going soft in their opposition to Yucca Mountain.

In the wake of this week's controversies, "I have gotten calls asking 'Has the state of Nevada softened its position?" Bryan said.

Bryan said the governor's decision to allow the Energy Department to continue pumping water at the nuclear site, along with a questionable appointment to the state's Yucca advisory board, "has raised a number of eyebrows as to what the state's policy is."

"The congressional delegation is on the front lines on this," Bryan said.

"I just think it would be important for them to meet and to come out united, to make sure the state's position is reaffirmed."

Bryan is chairman of the state's Commission on Nuclear Projects, which was a focus of one of the governor's actions.

The members of the seven-person advisory panel historically have reflected the state's staunch opposition to Yucca Mountain. But Gibbons raised a furor when he replaced vice chairman Michon Mackedon of Reno with Joni Eastley, a Nye County commissioner who is not an ardent foe of the project.

Eastley's appointment was withdrawn.

Spokeswoman Melissa Subbotin also said Gibbons is consulting with Nye County residents over a substitute for Eastley. He said he wants a resident of the Yucca site county on the panel.

Stephens Washington Bureau chief Steve Tetreault and Review-Journal writer Paul Harasim contributed to this story.