Environmentalists say the Queensland Government provided “special treatment” for a controversial $2 billion irrigation project in the state's far north.

The Wilderness Society says bustling businesses and traditional landowners in the Gilbert River system are being kept out of water entitlements, but the massive Integrated Food and Energy Developments Pty Ltd (IFED) is heading for environmental approval of its 650 square kilometre crop irrigation scheme.

The IFED Etheridge Integrated Agriculture Project plans to capture and store water from the Einasleigh and Etheridge Rivers to irrigate 650 square kilometres of sugar cane and guar bean crops.

The company plans to store the water (about 555 gigalitres per year) in two deep off-river dams with a holding capacity of 2,000 megalitres.

IFED says at the height of construction the project will employ 3,000 people, maintain an ongoing operational workforce of more than 1,000 people, and bring in annual revenue of about $900 million.

State Development and Natural Resources Minister Anthony Lynham says he has signed a Memorandum of Understanding with IFED to cut a “clear and comprehensive pathway for the project”.

“Until IFED has completed the comprehensive EIS [environmental impact statement] process, Government is not in a position to release any unallocated water in the Gilbert River catchment,” he told Parliament.

Dr Lynham claims the Memorandum of Understanding was signed as a replacement for a secret development deal struck between IFED and the previous LNP government under Campbell Newman.

Dr Lynham says the current Labor Government has strengthened environmental safeguards, and will now require an independent peer review of the project’s water sustainability in particular.

The Minister tabled the IFED agreements struck by both the previous and current governments for review.

Wilderness Society's Queensland campaign manager Dr Tim Seelig said both deals breached the principles of transparency and good process.

“Minister Lynham has essentially replaced one dodgy secret deal with another dodgy secret deal that is almost identical in what it will deliver,” he told the ABC.

“This deal, essentially negotiated in secret, really provides not just special treatment but exclusive treatment to IFED for access to water in Gilbert River system with almost no real checks and balances.

“There is a thriving prawn fisheries industry, projects that traditional owners have been talking about getting up, and all of these existing industries and projects are going to be locked out because IFED has a sweet special deal.”

Traditional owners of the land, the Ewamian people, are outraged that the deal was done without talking to them.

Business figures in the existing $90-million-a-year banana prawn industry say they have been locked out of the process, even though the water allocations involved have a direct link to their livelihoods.

IFED chairman Keith DeLacy - a former Labor treasurer – says the company has not been granted any special favours, but has been given more certainty.