The Northern Territory government has approved Woolworths’ controversial plan to open a Dan Murphy’s megastore in Darwin despite community concerns.

Health groups have criticised the proposed bottle shop, which will be the largest in the NT, saying it will be devastating for nearby Indigenous communities.

NT’s Director of Liquor Licensing on Friday approved the liquor store application.

It said Dan Murphy’s parent company Endeavour Group – which is owned by Woolworths Group – had agreed to move the site and consulted with Indigenous groups.

The bottle store will also have to close by 9pm and customers will be required to identify where they intend to consume the alcohol.

Community leaders say they’ll continue to call for Woolworths to abandon its plans despite the approval.

“Our opposition to this store is because of the harm alcohol causes in the Northern Territory – fetal alcohol spectrum disorder, violence, hospitalisations, chronic disease, death,” Aboriginal Medical Services Alliance Northern Territory chief executive John Paterson said.

“Woolworths and Endeavour Group know that serious harms will inevitably follow.”

Community groups have also criticised the Endeavour Group’s community consultation, alleging it hadn’t happened and the offer to move the site wouldn’t mitigate the risks the store posed.

Woolworths on Wednesday announced it had put the plan on hold to review ongoing community concerns about the potential negative health effects of the store’s proposed location and an alleged lack of stakeholder engagement.

An independent panel review of the plan is expected to hand down its report to Woolworths by April.

The Director of Liquor Licensing’s announcement comes after the NT Independent Liquor Commission rejected Endeavour Group’s application in September last year.

The territory government then passed legislation in November to fast track some bottle shop applications, including Woolworths.

Endeavour Group has previously agreed to move the proposed bottle store 1.3 kilometres further away from the three nearby dry Indigenous communities.