The £40 billion engineering giant, Babcock, is demanding up to £500,000 from the Scottish Government's wildlife agency because it opposed the company's plans for a major new freight terminal in Fife.

Scottish Natural Heritage (SNH) argued at a public inquiry that the terminal proposed at Rosyth could threaten bird colonies in the Firth of Forth. Now Babcock is demanding SNH use taxpayers' money to help pay its expenses at the inquiry.

However, the multinational has been accused of trying to "punish" SNH for doing its job.

Babcock, which manages the Faslane nuclear submarine base on the Clyde and Rosyth dockyard, has applied to build a container terminal, which requires a 9.5-metre channel to be dredged in the Forth.

SNH claimed this could damage mudflats protected by European law because of their importance for wigeon, curlews, oystercatchers and other birds.

The plan was considered at a seven-week public inquiry last year. Scottish ministers have still to give their verdict, but Babcock has lodged an application asking them to order SNH to pay the firm's expenses.

The company has accused SNH of "a flawed understanding of the law", claiming SNH failed to follow public inquiry procedures, wasted time and caused "unnecessary expense".

But this has been disputed by SNH, which has filed a response rejecting Babcock's claim as "specious".

Iain Rennick, SNH's Forth unit manager, said: "We don't accept we acted unreasonably in making our case, and believe we would have been failing in our statutory duty if we hadn't done so. We are robustly contesting Babcock's claim."

The Royal Society for the Protection of Birds (RSPB), which also objected at the inquiry, said the firm had lost the scientific argument.

"It is disappointing that Babcock appears to be seeking to punish SNH financially for simply doing their job correctly," said RSPB Scotland's senior policy officer, Richard Evans.

Beryl Leatherland, a local resident and objector, dismissed Babcock's claim as "ridiculous bluster".

Babcock's claim does not specify a sum, but lawyers estimate it could be between £300,000 and £500,000.

A Babcock spokesman said the company's intention was "not to seek any financial gain" but to highlight the disruption and added financial burden caused by the inquiry.