Horizon Wind Energy has suspended development of the Simpson Ridge wind farm in Carbon County because of Wyoming's rigid position on protecting key sage grouse habitat.

Houston-based Horizon is not scrapping the project, but is placing it on hold indefinitely, project manager Nate Sandvig said Friday.

The company has been working to build a 198-turbine wind farm near Medicine Bow in southern Wyoming. The project falls in an area identified by the state as critical sage grouse habitat, known as a core population area.

Wyoming is home to more than half of the nation's population of sage grouse, a chicken-sized, ground-dwelling bird that the U.S. Fish and Wildlife Service is reviewing for possible listing as threatened or endangered under the Endangered Species Act.

Sandvig said it doesn't make sense for Horizon to focus its resources on a contentious project with murky prospects.

"Things may change," Sandvig said. "We're having conversations with Department of the Interior, and we'd like to seek more clarity on what their view is with regards to our project."

Gov. Dave Freudenthal signed an executive order last August restricting development in core areas, but the state didn't clarify its stance against wind development in core areas until last month. Wind industry officials responded that the position would likely chill development in the state.

Last month, the Wyoming Game and Fish Department sought clarification from the Fish and Wildlife Service regarding its position on wind development in core areas.

Brian Kelly, supervisor in the agency's Wyoming field office, responded that the office was opposed to any wind development in the core areas prior to demonstration that it can be done with no impact on sage grouse.

Wyoming officials have said they'll abide by the Fish and Wildlife Service's interpretation. Their goal is to stave off federal protections for the bird, which could have a stultifying influence on oil and gas development, agriculture and other economic development.

Sandvig said Horizon made the decision to suspend the Simpson Ridge project last week as it neared time to submit a permit application to the state's Industrial Siting Council. The council has permitting authority over industrial projects with construction costs of $173 million or more.

Sandvig said Governor's Office staff members indicated they would recommend against approval for Horizon's permit application.

Officials in the Governor's Office could not be reached for comment Friday afternoon.

"I think a lot of people are looking at us ... figuring out how to navigate through this issue successfully, and as you can see, it's not a rosy picture," Sandvig said.

Sandvig said he doesn't know what the project's suspension will mean for a concurring scientific study that was looking at how the sage grouse near the project would respond to the new turbines.