ELKO, Nev. — Two environmental groups have dropped opposition to a 680-mile natural gas pipeline from Oregon to Wyoming, now that El Paso Corp. has agreed to spend $20 million to help protect sagebrush habitat and buy grazing permits from ranchers willing to part with them.

El Paso Corp., the nation's leading natural gas pipeline company, and officials for the conservation groups said the pact, which also covers parts of Nevada and Utah, is unprecedented.

It calls for the Houston-based company to spend $15 million to set up a conservation fund for the Idaho-based Western Watersheds Project and $5 million to create a fund for the Oregon Natural Desert Foundation.

Habitat protection will be targeted along the pipeline's corridor for at least the first five years. The pipeline begins near Opal, Wyo., and goes through northern Utah and Nevada before ending at Malin, Ore., on the California line west of the Hart Mountain Antelope Refuge and Sheldon National Wildlife Refuge.

"The bottom line is we think it's a preferable approach than being involved in litigation," El Paso spokesman Richard Wheatley said. "There is the potential to do really good work."

The Idaho and Oregon conservation groups had spoken out against the $3 billion pipeline project and had asked the Federal Energy Regulatory Commission in April for a rehearing on the panel's initial approval of it.

But with El Paso's commitment, "we agreed not to try to delay or litigate Ruby Pipeline," said Jon Marvel, executive director of the Western Watersheds Project.

Marvel's group is one of three plaintiffs in a federal lawsuit challenging the U.S. Fish and Wildlife Service's refusal to declare the greater sage grouse a threatened or endangered species.

Marvel said he expects the Western Watersheds fund to eventually be used to buy grazing permits from willing ranchers, but the organization first wants Congress to approve legislation to allow federal agencies to permanently retire grazing permits in such cases.

"It's unprecedented to have the support of industry to work for the retirement of public grazing permits," he said, emphasizing that the fund would only buy permits from willing sellers.

Jim Cleary, president of El Paso Western Pipeline Group, said the agreement brokered last week reflects the company's "commitment to environmental stewardship and, to this end, represents a significant component of the unprecedented voluntary mitigation efforts being applied to Ruby's construction and operation."

Both agreements provide incentives for the parties to seek additional funding sources beyond El Paso's contribution.

"We hope to encourage other private and public funders to contribute to the fund's efforts to permanently protect and restore large areas of high desert in the region the Ruby Pipeline will pass through," Cleary said.

Brent Fenty, executive director of the Oregon Natural Desert Foundation, said the foundation intends to use the fund to promote rangeland restoration, including spring restoration, fence removal, weed control, land acquisition and grazing permit retirement.

"Protecting the area around the Hart Mountain and Sheldon Refuges is critical to ensuring the survival of high desert species like sage-grouse and pronghorn antelope," Fenty said.

Wheatley said the funds will be administered by three-member boards. Each includes a representative of El Paso, a representative of the conservation organization and a third party.

"It remains to be seen how this will all unfold," he said.

Western Watersheds and the Oregon organization won't receive any funds directly from El Paso, but the Texas-based company will donate $20 million to the new conservation funds over a 10-year period.

Marvel said the agreement designates the counties through which Ruby Pipeline will pass and any counties adjacent to them for the first five years of conservation efforts, including Elko County, but the fund can cover anywhere with sagebrush habitat after the five-year period.

"The money also can be used to purchase private property or conservation easements, but our priority is grazing permits," he said.