PORTLAND – A formal review of the water quality certification of a dam on the West Branch of the Penobscot River may jeopardize a settlement that would balance hydropower needs with environmental and recreational interests.

The settlement, which took two years to broker, would protect waterfront land from development and restrict drawdowns on the Canada Falls, Ragged, and Seboomook reservoirs. The restrictions aim to protect wild brook trout and wild salmon fisheries, wetlands, recreational angling, and white-water boating.

Parties to the settlement, including Great Lakes Hydro America, the Appalachian Mountain Club, two Indian tribes and state and federal agencies, have asked Maine’s Department of Environmental Protection to relicense the dams before Jan. 1.

That would allow Great Lakes Hydro to exercise options on conservation easements that would protect 200 feet of Ragged Lake’s shoreline and 40 percent of Caucomgomoc Lake.

But a recent decision by the state Board of Environmental Protection to review the license for a dam on Flagstaff Lake could have repercussions on the Penobscot River.

The board voted in April to overturn the water quality certification for the Flagstaff dam, owned by Florida Power and Light, and ordered a formal review and federal approval of the license.

Florida Power and Light is challenging that decision in Kennebec County Superior Court. But Department of Environmental Protection officials say the decision means the agency must request a similar review for the Great Lakes Hydro project.

Such reviews typically take about six months, making it a “pretty iffy proposition” that it will be completed by Jan. 1, said Dana Murch, dam and hydro supervisor for the Maine Department of Environmental Protection.

“If we can’t get through the process in time, it will not only jeopardize that conservation easement but may jeopardize the entire settlement,” Murch said.

Murch plans to give the DEP a proposed review schedule, which would include a public hearing on Oct. 7 in Bangor.

Naomi Schalit of Maine Rivers said she is “delighted” that the Great Lakes Hydro project also will have to undergo a formal review even though it could threaten the environmentally friendly settlement.

“The DEP is doing exactly what it should do,” she said.

The BEP will hear the case Thursday at its regular meeting at 9 a.m. at the Holiday Inn Ground Round in Augusta.