Landbridge Group wins rights to operate port, including marines supply base, in deal that NT government says will lower debt and pay for other infrastructure

This article is more than 4 years old

This article is more than 4 years old

The Northern Territory government has signed a $506m agreement with a Chinese based group for a 99-year lease of the Darwin port, but the union has expressed outrage at a lack of protections for workers.

The deal, resulting from a tender process begun in 2014, gives the Landbridge Group 100% operational control of the port and 80% ownership of the Darwin Port land, facilities of East Arm wharf including the marine supply base, and Fort Hill wharf.

The remaining 20% will be held by the Northern Territory government for the first five years before transferring to another Australian entity to ensure some local ownership is retained.

NT chief minister Adam Giles said the decision to lease the port rather than sell allowed the government to ensure conditions are upheld. The government intends to invest the money from the agreement into other strategic infrastructure, but in contrast to similar interstate port agreements, Giles provided no details on Tuesday.

“This money will go into a small part of paying back Labor’s debt but the other parts in investing in economic strategies for the NT to ensure we are recycling this money into job-growing activities for the future of the Northern Territory,” he said.

The NT government will retain “a range” of oversight and regulatory functions, and should port revenue rise above 130% of current modelling, the government will receive 15% of profits.

Landbridge Infrastructure Australia’s director Mike Hughes said the company had committed to no forced redundancies of the permanent workforce before 2018, and when questioned added he did not foresee any job losses through voluntary redundancies, or cutting of non-permanent staff. However he did say there were “operational efficiencies” which could be made.



“The proceeds will be used to invest in new economic infrastructure for the benefit for all Territorians,” he said.



“The lease process has delivered on many levels and we have ensured that employees, port users and the government’s interests are well protected. This is a fantastic outcome for the Territory.”

However the Maritime Union of Australia (MUA) has slammed the deal. Spokesman Thomas Mayor said the government had only paid lip service to the employees by not ensuring the protections were guaranteed past the 2018 end of the current enterprise bargaining agreement.

“We’re very disappointed in the CLP’s move,” he told Guardian Australia. The MUA called for the protections to be legislated for the life of the lease.

“It should be noted these workers haven’t had any industrial disputes at the port for more than 20 years,” said Mayor.

“These workers are seeing what’s happened to Buslink and the [recently privatised] Territory Insurance Office employees. The MUA is not the type of union which will stand by and see our members treated the same.”

Mayor also expressed concern the short term protections for workers would not extend to those on temporary or fixed term contracts or who are employed by the port on other services, such as security and pilot boat staff.

Landbridge is a privately owned Chinese group which has operated in Australia for about 18 months. It has agreed to maintain a pricing regime with no more than CPI indexed adjustments for the use of current port facilities.

The agreement did not have to go through the foreign investment review board, said Hughes, but the company approached it regardless and received approval.

Hughes said the company was also looking for investment opportunities outside the port.

“Through our extensive relationships in China particularly but Asia more generally, we will also facilitate bringing further Chinese investment in the Northern Territory, further Chinese business, either through investing directly in projects that need capital here in the Territory or providing a market in China for products that are going to be exported,” he said.

He later added that growth would be constrained by current rail infrastructure in the Northern Territory, but said “it was not a major impediment” and Landbridge would be talking to stakeholders involved.

Andrew Robb, federal minister for trade and investment said the agreement was a “powerful sign of the enhanced commercial relationship between Australia and China flowing from the China-Australia free trade agreement.

“Landbridge’s commitment to the growth of the Port of Darwin will be a huge spur to the development of Australia’s north, serving as a catalyst for the entry of major investment right across the port’s upstream supply chain in agriculture, resources & energy and economic infrastructure,” he said.

Territory Labor criticised the decision as “short sighted” and against the long-term interests of Territorians.

Opposition leader Michael Gunner said Labor would have retained control of the port and sought investment in its infrastructure, but that if a Labor government were to win the 2016 election, it would honour the contract. Just hours prior to the announcement Labor called for a deferral of the sale or lease of the port until after the next general election, claiming the CLP government did not have a mandate.