A correction to an earlier version of this article has been appended to the end of the article.

OAKLAND — In a major setback to a years-long effort to reinvent the former Oakland Army Base, the city has notified developer Phil Tagami that it is terminating his lease, effectively putting an end to his controversial plan to build a marine terminal and export coal, according to letters sent last month by city attorneys.

City officials in those letters said Tagami has failed to meet construction milestones agreed upon in the lease, and sent him a notice of default on October 23, effective November 22. The default notice said Tagami must pay the city $1.6 million in project liquidated damages as specified in the 66-year lease.

“This isn’t about coal. This is about the developer’s failure to meet its obligations and perform the work it agreed to do. (The developer) had years to move this project forward, and has used every excuse in the book to justify its failure to perform,” City Attorney Barbara Parker said in a statement.

After years of planning, the military turned over the shuttered base to the city and Port of Oakland in 2006. The city had flirted with several different visions for its half of the property before giving Tagami the green light for a $1 billion state-of-the-art logistics center and marine terminal in 2012. Among them were an Indian casino, hotel, convention center, and, if a failed plan by Keenen Ivory Wayans had come to pass, a movie studio and entertainment village.

The once-touted terminal project had already run afoul of Oakland city leaders, who belatedly voted to ban coal after learning of Tagami’s surreptitious deal with Utah coal companies to ship their product overseas. Tagami sued and the battle landed in federal court. In May, U.S. District Judge Vince Chhabria struck down the city’s coal ban, a decision the city is appealing.

Now it appears there will be a new court fight over the terminated lease. Last month, Tagami and his business partner, Mark McClure, filed a 51-page claim against the city, a precursor to a lawsuit.

Tagami referred questions to his attorney, David Smith, who blamed the city for standing in the way of the project.

“If we need to go into state court to have another judge tell them to honor the agreement, we are prepared to do that,” Smith said this week.

Known as the Oakland Bulk and Oversized Terminal (OBOT), the $250 million project on 34-acres near the Bay Bridge Toll Plaza would carry commodities by rail to a marine terminal to be shipped overseas. Initially welcomed by city leaders because of promised reductions in emissions from trucks at the port, it fell out of favor in 2015 when Oakland politicians and environmental activists learned of the coal deal.

The City Council in 2016 voted to ban the storage and handling of the ore within city limits. Tagami sued, arguing the ban violated his 2013 development agreement, which did not specify what goods could or couldn’t be shipped.

Parker sent Tagami a notice of lease default dated September 21, warning OBOT that it had failed to meet its obligations under the February 2015 lease, according to a copy of the letter. The “West Gateway” lease includes the marine terminal logistics center and land for rail improvements. Under terms of the lease, OBOT was supposed to have started construction at the site by By August 14. The work includes rail improvements and construction of the marine terminal, however, city officials said the work has not commenced and Tagami has not obtained permits, among other obligations.

On Oct. 23, Parker said OBOT failed to satisfy obligations within a 30-day “cure period,” leading her to issue the notice of lease termination.

Smith, Tagami’s attorney, said the city has not given OBOT’s workers access to the site’s rail areas and accused the city of not holding up its end of the lease.

“The city has said to us, ‘we will not move this project forward unless you agree to comply with the (coal) ban,’ ” Smith said. “The ban the federal court said is illegal.”

Smith said the ban and the city’s appeal of the federal judge’s ruling created uncertainty surrounding the project. “You cannot limit them from a market standpoint by pulling a politically disfavored commodity of the day,” Smith said.

OBOT’s initial tenant to operate the terminal, Terminal Logistics Systems, dissolved, though the new tenant, Insight Terminal Solutions, is made up of many of the same key players.

On its website, Insight Terminal Solutions lists two former Port of Oakland executive directors, Jerry Bridges and Omar Benjamin, as CEO and vice president, respectively. John Siegel, the former CEO of Bowie Resources, now Wolverine Fuels LLC, is executive chairman of Insight Terminal Solutions. Bowie, and now Wolverine Fuels, owns and operates coal mines in Colorado and Utah.

Four Utah counties had earmarked $53 million for the terminal. Critics question if Tagami has the money to do the project.

“The idea that any knowledgeable investor would lend $250 million to build a marine terminal dedicated to coal in 2018 is absurd,” said Ted Franklin of No Coal in Oakland. “They say they’re not interested in filing another suit or fighting more with the city, but this looks more like an attempt to blame the inevitable collapse of the financing of the terminal on the City. Tagami has never identified any private investors willing to back the terminal.”

City officials would not say if another lease with Tagami would happen but in a statement, City Attorney Parker said, “the city must move this project forward with partners who are able to get the job done.”

Smith said OBOT is not going to pay the $1.6 million in liquidated damages and wants to move forward with the project. “If we don’t break the log jam, we’ll have a judge do it,” he said.