As Scotty Wurramarrba steers his boat into turquoise waters surrounding Winchelsea Island, he points to where a large crocodile was recently spotted.

Key points: The GEMCO manganese mine on Groote Eylandt will run out in about a decade

The GEMCO manganese mine on Groote Eylandt will run out in about a decade The Anindilyakwa Land Council is now eying a new mining venture to secure income for its people

The Anindilyakwa Land Council is now eying a new mining venture to secure income for its people It has formed a mining company with a Chinese-backed group to assess the viability of a manganese mine on Winchelsea Island

But besides the wildlife, this island in the Gulf of Carpentaria is uninhabited — at least for now.

In several weeks, traditional owners hope to receive approval to begin drilling exploration to assess the viability of a potential manganese mine on the island.

"It just guarantees that we have a good future for our next generation and the generations to come," Mr Wurramarrba said.

For decades, the Anindilyakwa people on Groote Eylandt, 650 kilometres south-east of Darwin, have received tens of millions of dollars in annual royalties, which flow each year from the GEMCO manganese mine.

But the mine's operational life is coming to an end, posing a threat to the funding that supports multiple programs and services on Groote Eylandt.

"The GEMCO mine is probably going to run out in the next 10 or 11 years, so we need something else to sustain us," Mr Wurramarrba said.

Traditional owners believe Winchelsea Island holds the answer, and they've now set up a mining company, in which they own the majority stake.

"We are in uncharted waters," Anindilyakwa Land Council chief executive Mark Hewitt said.

Traditional owners hope to set up a new manganese mine on Winchelsea Island. ( ABC News: Jano Gibson )

"Under the Land Rights Act, it is not contemplated that you actually become an applicant to mine on your own land.

"Normally you are a passive royalty recipient to a third party who comes in and hands royalties out."

Winchelsea Mining Pty Ltd is a joint venture with a Chinese-backed company called AUS China International Mining.

The partnership was formed after Mr Hewitt and ALC chairman Tony Wurramarrba met investors during a Northern Territory Government trade delegation to China several years ago.

"It's early days yet, but potentially, this is a real gamechanger," Mr Hewitt said of the potential mine.

"It's exactly that concept of taking ownership and getting the majority benefit of that."

The Territory Government is supporting the mining initiative as part of an agreement with the land council that will hand greater control of a range of government services to the Anindilyakwa people.

Chief Minister Michael Gunner says an agreement with the Anindilyakwa Land Council handing greater control of a range of government services to its people. ( ABC News: Jano Gibson )

"It goes through all the normal [regulatory] processes a mine would do," Chief Minister Michael Gunner said.

"If this mine gets up and it is successful, it puts money into a trust fund here on the island and the interest off that will help sustain their future."

A separate element of the Local Decision Making Agreement involves the staged transfer of 240 government-managed houses to an Anindilyakwa-controlled organisation.

The agreement will also see the construction of a new Cultural Rehabilitation Centre.

"The centre will provide the courts and community with options for eligible Anindilyakwa male youth aged 17 to 25 years, with an alternative to a term of imprisonment for eligible offenders, or persons identified as at-risk of offending or re-offending," the agreement states.