Submitted as part of the Regional Development Australia Fund (RDAF) - Round Two process, Mr Winton said the $14 million project would support economic growth, enhance liveability and facilitate diversification away from declining industries such as forestry.

"Natural gas is a low emission, highly efficient and reliable source of energy that would provide greater energy diversity for current and future businesses and residences of Smithton as we head into a carbon constrained economy," Mr Winton said.

"Access to natural gas infrastructure will enhance the viability of existing businesses, attract new large-scale commercial investment and drive increased economic activity in the Circular Head region over the 50+ year life of the pipeline."

Mr Winton said Council was looking to engage with a number of partners such as Tasmanian Dairy Products, Tas Gas Networks, McCain, Emmerton Park Aged Care, the Department of Economic Development, Tourism and the Arts, the Smithton Hospital and Murray Goulburn as part of the application for funding.

"In combination, McCain (100 FTEs) and Tasmanian Dairy Products (70 FTEs) will support circa 170 FTEs drawn from the Circular Head region," Mr Winton said.

"For emerging businesses such as the milk processing facility, access to natural gas will reduce their capital cost and assist in the plant's operational stability and in the overall cost competitiveness and inherent success of the business.

"For others such as McCain and Murray Goulburn, who may consider relocating to Smithton to access the pipeline, natural gas will enable access to a more reliable and affordable power source that will also enable the region to reduce its reliance on forestry/timber processing and provide key infrastructure needed to attract investment in food processing and other heat intensive value added industries."

Mr Winton said the infrastructure would provide the opportunity for further expansion and reticulation throughout Smithton, subject to further funding.

The project would require a polyethylene (plastic) pipe, of about 28km in length, to be extended from Port Latta through Smithton to McCain's potato processing factory.

The Council is seeking either funding for part of the project and is prepared to consider contributing to the project if necessary in conjunction with industry, state and other federal funding if applicable.