Chinese firm Landbridge set to be stripped of its controversial lease of the Port of Darwin

Chinese firm Landbridge is set to be stripped of its controversial long-term lease of the Port of Darwin regardless of who wins the election, with the two main major parties pledging to take control of the facility if necessary.

Prime Minister Anthony Albanese dialled into ABC Darwin radio at short notice on Friday evening in a hurried bid to pre-empt a similar announcement by Opposition Leader Peter Dutton, who was en route to Darwin to launch his first major national security announcement of the campaign.

Dutton was preparing to announce that a Coalition government would move quickly to terminate the current lease agreement, including by taking the dramatic step of seizing control of the port if Landbridge cannot sell it to another company.

The Port of Darwin was leased to the Chinese-owned Landbridge Group in 2015.Credit: Glenn Campbell

The Northern Territory Country Liberal government leased the port, which sits directly opposite Darwin’s Larrakeyah Defence Precinct, to Landbridge for 99 years in 2015 for $506 million.

The Australian Strategic Policy Institute has detailed extensive connections between Landbridge, the Chinese Communist Party and the People’s Liberation Army, raising concerns about the national security implications of the leasing agreement from both Coalition and Labor MPs.

Albanese announced that he wants to get the Port of Darwin “back into Australian hands”, declaring he wants to see the end of Landbridge Group’s 99-year lease of the port.

“We’ve been working on this for some time,” Albanese said of the government’s proposal, describing the port as a “strategic asset”.

Albanese said the government would move to kickstart negotiations to buy back the port, saying he would be prepared to directly intervene to enter a lease agreement if a private bidder cannot be found.

Albanese said the government had been talking with potential buyers and he was hopeful that an Australian superannuation fund may take over the lease.

Under questioning from the local ABC host about exactly what he was announcing, Albanese said he would provide more details later in the campaign.

Albanese raised expectations this week that Labor could seek to scrap the lease agreement, saying he would have more to say about the issue before the May 3 election.

Insisting he would never have “flogged it off in the first place”, Albanese said: “We opposed the sale of the port of Darwin. We opposed it at the time, we thought that was unwise.”

The Coalition said in a statement that it “would not permit the lease of the port to any entity that is directly or indirectly controlled by a foreign government, including any state-owned enterprise or sovereign wealth fund”.

A specialist commercial adviser would be appointed to work with the Northern Territory government and federal officials to provide advice and engage with potential new operators of the port soon after the May 3 election.

“If a private lease cannot be facilitated within six months of the process commencing, as a last resort, we will act to acquire the lease interest in the port using the Commonwealth’s compulsory acquisition powers,” the Coalition said in a statement it had prepared to release before Albanese spoke.

In a move guaranteed to anger Beijing, which has argued for relaxed foreign investment rules, the Coalition vowed to end uncertainty over the lease “once and for all”.

Landbridge would receive federal compensation under this scenario.

The Coalition is also preparing to announce an increase in defence spending in a bid to bolster its credentials on national security while toning down the rhetoric on Beijing in an attempt to win back Chinese-Australian voters who deserted them at the last election.

The Albanese government commissioned a review of the port lease by spy agency ASIO and other agencies after coming to office.

In 2023, the government announced, following the review, that it “was not necessary to vary or cancel the lease” because there was “a robust regulatory system in place to manage risks to critical infrastructure”.

Labor MP Luke Gosling, whose seat of Solomon includes Darwin, recently suggested there were plans for a public-private partnership at the port.

Former US president Barack Obama raised concerns with then prime minister Malcolm Turnbull that the lease could help Chinese intelligence-gathering on US and Australian military operations given up to 2500 Marines rotate through Darwin each year.

The Turnbull government did not need to approve the deal at the time, but it was welcomed by then trade minister Andrew Robb. Then defence minister Marise Payne said she was only informed of the deal a few hours before it was signed.

Landbridge, which is owned by Chinese billionaire Ye Cheng, has faced financial difficulties at the port but has insisted it sees the facility as a “long-term investment”.

Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter.