OLD TOWN, Maine — A Casella Waste Systems Inc. subsidiary and Bangor Gas Co. have entered their third month of negotiations in a dispute over plans to build a seven-mile pipeline that would provide the University of Maine at Orono with methane gas.

EcoGas LLC and Bangor Gas representatives first began discussions in late April after Bangor Gas was one of six entities to file a petition to intervene as parties in Maine Public Utilities Commission’s consideration of the project.

In the Bangor Gas petition, attorneys for Bangor Gas from Skelton, Taintor & Abbott said the company wanted to intervene because the pipeline agreement between UMaine and EcoGas would harm Bangor Gas and its ratepayers.

Bangor Gas currently provides the university and 12 communities in the Greater Bangor area with gas services and would be “directly, substantially and adversely affected” by the pipeline deal, according to the petition to intervene.

Don Meagher, Casella’s manager of planning and development, said representatives from both companies have held one in-person meeting and multiple teleconferences since the PUC asked the two groups to try to hash out their issues and report back the next month.

The companies have asked for three extensions since the April meeting with the PUC. The latest extension sets July 16 as the next date for the groups to report back to the commission.

Meagher said he couldn’t provide details of the negotiations because EcoGas and Bangor Gas have a confidentiality agreement, but that progress was being made. Otherwise, he said, negotiations would have broken off by now.

“I think we’ve made a lot of progress and I’m optimistic about it,” Meagher said.

“If we weren’t making any progress and there weren’t any opportunity here, then we would have ended it at the first extension,” he said.

A Bangor Gas representative did not respond to a request for an interview during the week, but the petition to intervene called the EcoGas proposal “unlawful, unfair and contrary to the provisions of Maine statutes and precedent.”

Bangor Gas also argued in the petition that the landfill gas deal would lead to degradation of its franchise.

The EcoGas-proposed pipeline system would move methane gas from Casella-operated Juniper Ridge Landfill in Old Town to UMaine’s Steam Plant, where the gas would be used to run boilers and create heat for campus buildings.

Made of 12-inch diameter high-density polyethylene pipe, the gas pipeline would run south to Route 43 before turning east on Route 43 to the intersection with College Avenue Extension, where it would continue on to the Steam Plant. Casella expects the project will cost between $11 million and $13.5 million to design, build and permit.

The university and Casella reached a deal in November 2011 after about three years of discussion.

UMaine has said it expects to save $15 million under the 20-year agreement, while reducing its carbon footprint.

According to PUC rules, there is no statutory deadline for this type of case. Negotiations can continue until either an agreement is reached, which would allow the commission to move forward with its consideration of the project, or one party decides to call off the talks, which would prompt litigation before the commission.

EcoGas laid out several goals and deadlines in its proposal. It hopes to complete the permitting process by Dec. 31 with plans to start providing UMaine with methane gas by the winter of 2013-14.