Montana Gov. Steve Bullock is defending his administration's handling of a major coal mine proposed near the Wyoming border after its sponsor shelved the project.

Arch Coal, Inc. said Thursday the Otter Creek mine faced hurdles including an uncertain outlook for obtaining a permit. The St. Louis-based company filed for bankruptcy protection in January.

Bullock said in a statement that the state had waited for more than a year for Arch to re-submit its mining application. Regulators in March 2015 had raised concerns over Otter Creek's potential to harm water supplies.

Republican Greg Gianforte, who hopes to challenge Bullock this fall, accused the Democratic governor of refusing to issue a permit to Arch.

Montana Department of Environmental Quality Director Tom Livers says it was up to Arch to take the next step in the process.