The Australian government said on Thursday it had launched legal action against the multinational manufacturer 3M over Pfas chemical contamination at defence bases, seeking damages of more than $2bn (US$1.4bn).

The attorney general, Michelle Rowland, said the use of per- and polyfluoroalkyl substances, known as “forever chemicals”, in firefighting foam had caused major environmental and economic harm, resulting in the largest legal claim ever brought by the federal government.

Pfas products are no longer used in Australia, due to long-running concerns about environmental contamination and health risks.

The chemicals are widely used in manufacturing of products resistant to heat, stains, grease and water. But they do not break down naturally like other products, and sites where they have been used require expensive remediation.

Health risks related to Pfas use include liver damage, lower birth weight and testicular cancer.

“This is a government that is prepared to take on one of the biggest multinational corporations in the world for the betterment of Australian citizens,” Rowland said.

“This misconduct has contributed to substantial costs for defence and the Australian taxpayer, including over $1bn to date to investigate, remediate and mitigate Pfas contamination at defence estate sites.”

The government alleges 3M, the American-based manufacturing giant, and its subsidiary, 3M Australia, withheld and misrepresented information about the effects of aqueous film-forming foam, did not disclose what it knew about environmental risks and gave assurances about disposal and environmental safety that were inconsistent with what the company knew.

“The government is committed to holding 3M to account for the economic and environmental harms associated with Pfas contamination,” Rowland said.

The assistant defence minister, Peter Khalil, said 28 defence bases across Australia had been affected by the chemicals, requiring more than 200,000 tonnes of contaminated soil to be removed and treated.

More than 13bn litres of water has been used in the multi-year decontamination effort. Defence began phasing out Pfas chemicals in 2004.

“These court proceedings are about recovering the significant costs Defence has and will continue to incur while investigating and managing the defence estate and supporting Australians affected by Pfas,” Khalil said.

The company set a 2025 deadline to stop producing Pfas chemicals in late 2022.

A spokesperson told Guardian Australia 3M has never manufactured Pfas in Australia and stopped sales of the products “around two decades ago”.

“Despite this, the Department of Defence continued to use Pfas-containing fire fighting foams for nearly two decades longer, as noted in a recent legislative committee report.

“We will defend ourselves against these claims through the legal process.”

The company agreed to a US$10.3bn settlement in the US in 2023, funding to clean up a host of public water systems to remove pollution linked to “forever chemicals”.

The US Environmental Protection Agency has called Pfas an “urgent public health and environmental issue”.

Greens spokesperson Peter Whish-Wilson said action was needed to stop Australia becoming a global dumping ground for Pfas products.

“Big corporate producers and retailers of plastics and plastic packaging currently have no obligation to take responsibility for the products they unleash into the world,” he said.

“The onus is currently placed on the waste and resource recovery sector to safely manage the recycling or disposal of plastic packaging products that contain Pfas. This is an untenable situation.”

A parliamentary inquiry into forever chemicals last year found Pfas risk remained around the country. The federal government settled a $133m class action case about Pfas chemicals at seven sites around the country in 2023.