Inpex is constructing two LNG trains at Blaydin Point to process natural gas to be piped 889km from the Browse Basin off the West Australian coast.
Unions NT secretary Paul Kirby said workers told him the exhaust stack, which weighs more than 50 tonnes, fell from an almost vertical position when it detached from the rigging and fell, and would have caused a "pretty loud noise" - though an Inpex spokeswoman said it only fell from "a short distance above the ground", according to the ABC.
"The stack dropped the short distance and fell over its pre-lift position," the spokeswoman said. "Work in the area has ceased."
Kirby said it was his understanding that there were still large cranes working on the site when the incident occurred.
"It's just annoying for us that with lightning responses and things like that, information can get across the site within a matter of minutes, but with significant safety incidents we can't seem to get information across the site in a reasonable amount of time," he told the ABC.
"It would have fallen quite some significant distance and would have made a pretty loud noise when it hit, I imagine."
Inpex confirmed to Energy News that the 43m exhaust stack was being lifted by two cranes onto a thermal heater at the time of the incident.
"It appears that, during the lift, and when the stack was a short distance above the ground, the lifting trunnions on the stack may have failed," a spokesperson said.
"The stack dropped the short distance and fell over into its pre lift position
"No one was injured.
"All site safety procedures were followed and lifting operations for loads greater than 50t were suspended immediately across the Blaydin Point site and will not resume until all procedures have been re-assessed.
"It is not expected that this will impact overall schedule of the project."
Energy News understands the contractor involved in the action was Dutch heavy lifting contractor Mammoet, a subsidiary of SHV.
A failure of the lifting lugs has been suggested as the cause, possibly due to errors in fabrication or the pre-lift inspection process.
NT WorkSafe, which is investigating the incident, issued a statement confirming an exclusion zone had been in place before the lift, and no one was injured.
"Workplace Health and Safety Inspectors are currently onsite at Blaydin Point investigating the cause of yesterday's incident, where a heating stack being lifted by two cranes fell," Worksafe said in the statement.
"Preliminary findings show that a risk management plan was in place and an exclusion zone was created before the lift commenced.
"No workers where present in the exclusion zone when the incident occurred and there were no injuries as a result of the incident. The investigation is still ongoing and no further comments will be provided."
Staff were alerted to the incident on Thursday night in a note which also banned photography and ordered lifts greater than 50t to be suspended.
"During repositioning of the heating stack the load become detached from the rigging assembly at the top lifting points resulting in damage as it fell to ground within the exclusion zone," the alert from Inpex said.
"Security are patrolling the area and photography is not permitted of the scene and this will be enforced."
The project has started the mammoth undertaking of laying the deepwater pipelay for its 889m-long gas export pipeline. When completed it will be the fifth longest subsea pipeline in the world and the longest in the southern hemisphere.
Saipem's deepwater installation vessel Castorone will lay the remaining 718km offshore section of the 42-inch diameter pipe following the successful completion in November of the 164km shallow water section by the SEMAC-1.
The remaining 7km of the pipeline is onshore, incorporating the beach valve and the final section to the onshore LNG facilities site at Blaydin Point near Darwin.
"Castorone starting work means we are now a major step closer to physically connecting our onshore LNG facilities to the Ichthys field, where our offshore facilities will be moored for the 40-plus year life of the project," Ichthys LNG project offshore director Claude Cahuzac said.
"A significant amount of work has been safely completed to get to this stage of pipeline installation.
"This includes a range of activities in and around Darwin Harbour such as dredging, landfall civil works, rock quarrying and transportation, and marine cable crossings."
Deepwater pipelay is scheduled for completion in late 2015.
The project has hit a number of milestones recently, with the commencement of a multi-rig 20-well development drilling program about 200km off the WA coastline.
The ENSCO-5006 jack-up rig and the Jack bates semi-submersible unit will drill 4-6 wells across five drill centres, with the wells to be up to 5000m deep to target the Brewster Formation.