SAN FRANCISCO — The Bush administration can go ahead with a pilot program to allow as many as 100 Mexican trucking companies to freely haul their cargo anywhere within the U.S. for the next year, a federal appeals court ruled late Friday.

The 9th U.S. Circuit Court of Appeals denied a request made by the Teamsters union, the Sierra Club and the nonprofit Public Citizen to halt the program.

The appeals court ruled the groups have not satisfied the legal requirements to immediately stop what the government is calling a "demonstration project," but can continue to argue their case.

The trucking program is scheduled to begin Thursday, pending the delivery of a report from the Inspector General of the Department of Transporation.

The Federal Motor Carrier Safety Administration, the Department of Transportation agency charged with managing the program, said Friday that the court's decision is "welcome news for U.S. truck drivers anxious to compete south of the border and U.S. consumers eager to realize the savings of more efficient shipments with one of our largest trading partners."

However, the agency said it must still wait for final report by the inspector general and for Mexico to begin giving U.S. trucking companies reciprocal access before the program can begin.

The government also noted that FMCSA expects only two carriers operating a total of seven trucks will initially be authorized to participate. The number is likely to increase to 22 carriers operating 44 trucks within 30 days.

The Teamsters had complained that the government has not provided details of the reciprocal agreement.

In court papers filed this week, the Teamsters and Sierra Club argued there won't be enough oversight of the drivers coming into the U.S. from Mexico.

They also argued that public safety would be endangered in a hasty attempt by the government to comply with parts of the North American Free Trade Agreement (NAFTA).

The trade agreement requires that all roads in the United States, Mexico and Canada to be opened to carriers from all three countries.

Canadian trucking companies have full access to U.S. roads, but Mexican trucks can travel only about 20 miles inside the country at certain border crossings, such as ones in San Diego and El Paso, Texas.

The government contends that further delays in the project will strain the relationship between the U.S. and Mexico.

In court filings this week, government lawyers said that the program is an important interim step in fulfilling the United States' obligations under NAFTA. They said that Mexican trucking companies would have to meet the same regulations governing U.S. trucking companies, and that in some cases the requirements are stricter.

Representatives of the Teamsters did not immediately return calls late Friday from The Associated Press, and a Sierra Club spokeswoman declined to comment immediately.

The program is designed to study whether opening the U.S.-Mexico border to all trucks could be done safely.

Congress ordered the Department of Transportation this year to launch a pilot program to investigate the issue. As the start date neared, the Teamsters and the Sierra Club claimed the public wasn't given enough opportunity to comment on a program that, as proposed now, won't yield statistically valid results.

The government says it has imposed rigorous safety protocols in the program, including drug and alcohol testing for drivers done by U.S. companies. In addition, law enforcement officials have stepped up nationwide enforcement of a law that's been on the books since the 1970s requiring interstate truck and bus drivers to have a basic understanding of written and spoken English.