Natural Fuels Australia chief executive Richard Selwood told the Australian Broadcasting Corporation that the plant would turn palm oil into biodiesel for blending with mineral diesel.

The plant will produce about 150 million litres of biodiesel a year. About 20% would be sold in the Territory, most of the remainder would be sold in other parts of the country, and a small amount would be exported, according to The Australian newspaper.

Selwood said Darwin was chosen for because its location allowed cheap palm oil imports, but the Northern Territory government had offered no incentives to build at the site.