Nestle Gives Up on Bottled Water Factory in McCloud

The Nestle company says it is significantly scaling back plans in Northern California to build what would have been the country's largest water bottling plant.

The announcement on Monday by Nestle Waters North America comes after years of opposition by environmentalists and a group of residents in the rural town of McCloud.

David Palais, Nestle's Northern California natural resource manager, says building a 1 million square foot facility at the base of Mt. Shasta no longer makes economic sense. He cited soaring fuel and transportation costs.

The company also has built a plant in Denver and expanded other facilities in the West.

Palais told The Associated Press that those expansions make a large plant in California less necessary.