By Kirsty Needham

SYDNEY (Reuters) -Australia said a security review of a 99-year lease held by Chinese company Landbridge on the northern port of Darwin, emerging as a key focus of its defence strategy, found it was "not necessary to vary or cancel the lease".

In a statement, the prime minister's department said: "Australians can have confidence that their safety will not be compromised, while ensuring that Australia remains a competitive destination for foreign investment".

It added that monitoring of security arrangements would continue around the northern port.

During a diplomatic dispute that is now easing, China had criticised Australia for blocking Chinese investment in infrastructure on national security grounds.

The 99-year lease of the commercial port to Landbridge was put under scrutiny in 2021 by the Australian government as it boosted foreign investment screening and introduced a national interest test for critical infrastructure.

After it won election in 2022, Prime Minister Anthony Albanese's Labor government launched a second review of the lease, involving defence, foreign affairs and security agencies.

The announcement the lease would not be varied or cancelled, comes ahead of Albanese's visit to Washington next week, and ahead of an expected visit to China this year.

Landbridge won a bidding process in 2015 to operate the port in a deal worth A$506 million ($390 million).

The awarding of the contract to Landbridge by the Northern Territory government came just a few years after the United States posted the first of a rotating group of U.S. Marines in Darwin.

The size and scope of U.S. military rotations through northern Australia, and the strategic importance of northern bases, has been boosted after an Australian defence review said in April China is undertaking the largest military buildup of any country since the end of World War Two.

Australia is pushing for China to lift trade blocks on its wine industry ahead of the Albanese visit, with a World Trade Organisation ruling on the dispute imminent.

An Australian journalist detained for three years in Beijing on national security charges was released a week ago, which the Australian government said was a sign of the stabilising diplomatic relationship.

(Reporting by Kirsty Needham; Editing by Raju Gopalakrishnan)