Hi, this is more natural:
"Dear XXXX (manager's name, e.g. 'Mark' or 'Mr Roy'),
I would just like to inform you that we have been working on this project for a very long time. We have devoted a lot of time and effort to it, but we have just been told that it has been cancelled at short notice. This news has left us feeling quite disappointed and frustrated. This is a very critical project and it means a lot to us. If we had continued working on it, it would have been very successful. I would therefore like to ask Sally to have a discussion with our team in order to explain the situation in more detail.
Best regards,
XXXX (your name)"