One of the crown jewels in the federal government's Arctic strategy is mired in a slow-moving environmental clean-up and the threat of legal action, federal documents reveal.

The deep-water port at Nanisivik, Nunavut, remains under the control the federal fisheries department six years after Prime Minister Stephen Harper announced the creation of a naval refuelling station high in the northern archipelago.

Environmental remediation of the site is necessary before the Department of National Defence can take possession.

But a private company which operated a now-defunct zinc mine in the region has yet to complete a clean-up of a fuel tank farm, despite four years of pressure from the military.

A 2009 briefing note to former defence minister Peter MacKay, obtained under access-to-information legislation, warned that delays by the company were a major risk to the project schedule and cost.

The cost has already swelled to $116 million from the original $100 million estimate.