Mining company TNG Limited has ditched its plans to build a mineral-processing facility on Darwin Harbour.

The decision follows concerns raised by environmental groups, a pearling company and a public rebuke by the NT's Environment Protection Authority (NT EPA).

TNG Limited announced to the ASX on Thursday that it would now look to build its magnetite-processing facility at its proposed Mount Peake mine site, about 200 kilometres north-west of Alice Springs.

The company's initial proposal to build the facility at Middle Arm attracted criticism over its proposed water usage and the 12 gigalitres of wastewater it wanted to pump into Darwin Harbour each year.

TNG altered its proposal in April, incorporating a wastewater recycling plant that removed the need to discharge into the harbour.

Then, in May, the NT EPA's chairman Paul Vogel issued a rare public rebuke of the company, accusing TNG of publishing "incorrect and potentially misleading" statements to the ASX.

After the EPA issued new directions to TNG, and asked for more information, according to TNG managing director and CEO Paul Burton, the company reviewed its previous potential locations for its processing facility.

"Obviously, with the Darwin site, there were some challenges and we listened to the community and to the NT EPA," Mr Burton said.

"As we've done the review now, the Mount Peake site stacks up extremely well as a much more consolidated, optimised combined mine benefication site and processing facility."

The Mount Peake processing facility will use around 3,000 to 4,000 megalitres of water a year in its operations, which would be drawn from local aquifers.

TNG also said building the processing facility in its new location would be cheaper because it would be outside a cyclone zone and there would be a reduction in solid waste and tailings disposal.

The company will now need to alter its environmental impact assessment with the EPA.

"Some of the work done in the Darwin area will apply — it doesn't really matter where the plant is, the noise emissions are the same, the air emissions are the same — but there will be other areas where the EPA will ask us to address, which we will," Mr Burton said.

"But we're not starting all over again."

NT EPA chair Paul Vogel issued a statement accompanying TNG's announcement to the ASX.

"The NT EPA acknowledges TNG's decision to fully integrate the Mount Peake project at the mine site and is looking forward to working closely with the company to resolve the environmental approval process in an efficient and timely manner," it said.

Potential green hydrogen facility for Middle Arm

TNG also announced it is working with a Malaysian company to look at building a green hydrogen plant at its Middle Arm site.

"The arrangement we have with this Malaysian group, AGV, is to produce hydrogen for the export market but we will also have the ability to produce it for the local market," Mr Burton said.

"We haven't decided on the exact size of the plant yet. That will depend on the availability of land … but we expect to have off-take arrangements via our Malaysian group with countries in Asia.

"We will also have a green hydrogen facility at the Mount Peake mine site, to make that as carbon-zero emissions as possible."

TNG aims to start construction on its Mount Peake mine in early 2023.