The Tumby Bay District Council has reaffirmed a decision made in 2017 to waive a conservation-based land management agreement (LMA) for the proposed Cape Hardy port site.
An internal review conducted by the council also revealed that if court action was taken against the council by neighbouring landowners, Iron Road would have paid the council's legal fees.
Iron Road owns two subdivisions of an original block of land subject to an LMA, which was waived by the council in September 2017, under the condition that port construction began within five years.
The decision came after the project received major project approval from the state government in May 2017.
Neighbouring allotment owner Sallyanne Hill sought the review, as she believed the council created a level of secrecy around the decision
"The District Council of Tumby Bay 17 years ago deemed that land was necessary for conservation," she said.
"It makes a mockery of that whole process for council to just waive it now."
Councillor Bob Lawrie said Iron Road had offered to pay the council's legal fees if the matter went to court over the decision, which chief executive officer Trevor Smith confirmed.
"I do believe we've got a conflict here, it really worries me...we've been given an incentive we shouldn't be receiving," Mr Lawrie said.
However Mr Smith said it was not a financial incentive for council as no profit would be made.
After the motion to reaffirm the waiver was carried, Mr Lawrie called for a division and the motion was carried again.
Councillors determined the benefit of the port to the wider community was greater than the benefit of the LMA, and that major project status from the state government overruled the LMA.
Iron Road has three years remaining to begin construction on the port before the waiver expires.