A $130 million deep sea port in an area listed as internationally significant for wildlife is already open for business, despite no formal environmental impact assessments from either the Northern Territory or Commonwealth governments.

The head of the Northern Territory Environment Protection Authority (NTEPA) has admitted "gross deficiencies" in the existing laws meant companies could ignore the NTEPA and "that is just the way it is".

Companies face up to $8.5 million in fines for breaching federal environment laws but under existing NT legislation no penalties apply.

Port Melville is located on the Tiwi Islands, 80 kilometres off the coast of Darwin.

The Singaporean owner and developer of the port Ausgroup has been promoting it as a marine supply base for the offshore oil and gas industry.

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Storage tanks which can store up to 30 million litres of diesel have been installed within an area that the NT Government has said in a report supports "many species not recorded anywhere else in the Northern Territory or in the world".

In the report, the Tiwi Islands are said to be the habitat of 38 threatened species of plants and animals.



Under Commonwealth law, projects likely to have a significant impact on a "matter of national environmental significance", must be referred to the Federal Government's Department of the Environment.

However, a spokeswoman for the department told the ABC the Port Melville project had not been referred to the Commonwealth, but the department is now making inquiries into the Singapore-based company behind the project.

The environmental department spokesperson said it was the responsibility of the company building the port to refer the project for environmental assessment but declined to make further comment while inquiries were underway.

In a statement on Tuesday, Senator Nova Peris said she has written to Environment Minister Greg Hunt requesting, "as a matter of urgency", that he conduct an inquiry.

"I have specifically requested that the Minister investigate whether the construction breaches the Environmental Protection and Biodiversity Act," the statement said.

"I have been contacted by concerned residents and traditional owners of the Tiwi Islands regarding the construction and its impact on their waterways and the large number of threatened plant and animal species it supports.

"I also raised these matters with the Minister for Indigenous Affairs, Senator Nigel Scullion, during Estimates in October last year."

The NTEPA has confirmed it is at the second stage of a possible 12-step process that must be completed before any project can proceed, despite the port being near completion.

Environmental Act has 'gross deficiencies', NTEPA head says

Speaking to 105.7 ABC Darwin, NTEPA chairman Dr Bill Freeland said he had sought a notice of intent from the company more than 12 months ago.

NT Environmental Protection Authority chairman Dr Bill Freeland. ( ABC News )

"However it was so deficient in information we had to request additional information ... we are still waiting for it," Dr Freeland said.

"We operate under the Environmental Assessment Act that gives us the power to call in and ask for a notice of intent and that was done.

"The act does not do any more than that, they can actually ignore it ... and that is just the way it is.

"[There are] gross deficiencies in the act which make our job extremely difficult," Dr Freeland said.

"I have no powers to approve or not approve [projects]. We only provide recommendations [to government]."

Dr Freeland said the company "certainly haven't abided by [the spirit of the act]".

"I don't think anyone [at the NTEPA] is particularly impressed."

Asked if the port was in operation currently, Dr Freeland said "I don't know".

Environmental lawyers claim impact of port not properly assessed

The Environmental Defenders Office (EDO) claim they cannot find any evidence that Port Melville's environmental impact was adequately assessed.

"They've gone ahead and constructed a port with, from what I can tell, a 30-million-litre tank farm for fuel storage without having a proper environmental approval at the Commonwealth level," EDO lawyer David Morris said.

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Environment law expert Tom Baxter said he was surprised at the lack of due process and that proceeding with a project that was likely to significantly impact a threatened species without approval from the Commonwealth was an offence.

"If construction activity is likely to significantly impact on, for example, a federally listed threatened species, or a migratory species, then the federal environment act requires the proponent to refer their proposal to the Federal Government before proceeding with it," Dr Baxter said.

"Given the scale of the project, the work that must have gone into it, it's amazing if it has got to this point without there being even a referral to the Federal Government."

Ausgroup declined to be interviewed by the ABC, however a company spokesperson said they had "been working collaboratively with the Northern Territory Government and with the Tiwi Land Council, addressing any environmental concerns associated with the construction or operation of Port Melville".

Companies face fines of up to $8.5 million for breaches

Penalties for breaching the Federal Environmental Protection and Biodiversity Conservation Act (EPBC Act) are up to $8.5 million in civil penalties and seven years' prison for criminal penalties, the government has said.

The company faces no fines under existing Territory environmental laws.

In March this year, Chief Minister Adam Giles toured Port Melville and commended Ausgroup for its partnership with the local Tiwi Land Council in developing industry on the islands.

On ABC Radio the chairman of the NTEPA said the authority first asked Ausgroup for more information about Port Melville 18 months ago but the information they received was not satisfactory, prompting the NTEPA to repeat their request.

In response Mr Morris said: "That's a little obsolete if the development has already pretty much occurred."

Under NTEPA's assessment process, if the authority determines there is no significant environmental impact from a project, it advises the proponent and the assessment process is complete.

If the NTEPA determines environmental impacts are likely, the process is much longer and includes public consultation.

It is not clear which NT Government minister is responsible for Port Melville but Dr Freeland said members of the NT Government were certainly aware that the NTEPA had not completed an assessment of the port.

Under Commonwealth law the primary responsibility for referral of the Port Melville project lies with its proponent, Ausgroup.

NTEPA should have responded earlier: lawyer

EDO's Mr Morris said it is hard to tell where the greatest failure has occurred.

"It's very hard to tell on the evidence who has failed but it seems to me there's either been a failure by the proponent or there's been a failure by the responsible minister," he said.

"I simply can't see how a development of this nature wouldn't have the potential to cause significant environmental impacts.

"In my mind, there's certainly been a failure by the NT Environment Protection Authority."

The ABC contacted NT Environment Minister Gary Higgins but he was not available for comment.

Dr Baxter said he would expect the Federal Environment Minister, Greg Hunt, to investigate whether Port Melville has breached the EPBC Act.

"If so, one could expect potentially, prosecution to follow," he said.

In a Senate committee hearing in October 2014, Indigenous Affairs Minister Nigel Scullion said he "assumed" an environmental impact study had been done on the port development.

Senator Scullion took several questions from NT Labor senator Nova Peris on the environmental approval process on notice.

He said he was not sure what sort of environmental regulations were in place.

"My instinct is that invariably bunkering facilities are actually subject to standards rather than environmental impact statements," he is quoted in Hansard as saying.

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