PennEast Pipeline Co. is for now dropping its years-long efforts to condemn state-owned land in New Jersey until it has more clarity on the beleaguered project’s timeline. 

The state notified a federal appeals court this week that the company has agreed to voluntarily dismiss condemnation proceedings for the pipeline. Environmental groups, including the New Jersey Conservation Foundation (NJCF), suggested the move is an indication that the project won’t go forward because it can’t be built along the proposed route without the land. 

However, PennEast said the pipeline remains critical to meeting energy demand in Pennsylvania and New Jersey. Spokesperson Patricia Kornick said PennEast has decided not to acquire the rights-of-way via eminent domain in court until it has more...