The court heard arguments from both sides of the debate, but ultimately in the end decided to side with the indigenous people who expressed grave concern that increased tanker traffic would cause significant harm to whales along the coast.

The Federal Court of Appeal instructed Ottawa - who struck a deal in May to buy the lucrative pipeline from Kinder Morgan for $3.5bn must reexamine the project and engage in dialogue and consultations with indigenous tribes, whilst also taking into consideration the impact marine traffic may have on its wildlife.

The primary objective of the pipeline is to move 890,000 barrels of oil a day from landlocked Alberta province to the Pacific coast for export overseas. It is has been claimed that the project has been designed to ease Canada’s reliance on the US market, in an effort to get a better price for its crude oil.

Ottawa unanimously approved the project in 2016 following a comprehensive environmental review, citing at the time that it was in the national interest. However, it faced stiff opposition from outraged indigenous tribes, environmental activists and local governments along the 1,150km (715-mile) route.  

Indigenous groups on whose traditional lands the pipeline crosses have expressed concern that the increase in shipping will impede the recovery of killer whale populations in the area.

The court concluded that the National Energy Board made a "critical error" in not considering marine shipping impacts, leading to "unacceptable deficiencies" in its recommendations to the government to greenlight the project.

It also said the government had failed in its constitutional duty to engage in dialogue meaningfully and grapple with the real concerns of the indigenous applicants so as to explore possible accommodation of those concerns."

Kinder Morgan shareholders, meanwhile, reportedly voted overwhelmingly to approve the pipeline's sale to the federal government. The company was not immediately available to confirm the vote result.