Darwin Festival insists its future is "secure" after it rejected an offer of $200,000 in sponsorship from a group of philanthropists, just two months after it lost the same amount of funding from Santos.
The event had been sponsored by the gas giant for decades, but in recent years faced accusations of "greenwashing" from environmental groups.
Santos' sponsorship included financial support for the well-known arts and cultural event held each August, going so far as to hold the naming rights to the opening concert.
In October, a group of philanthropists offered $200,000 in funding as an alternative to Santos' grant. The gas company then opted not to renew its support of the festival.
But now the festival's board has said it would not accept the grant, stating it could not come to an agreement with the group.
"There were some non-negotiable terms and conditions set out in the offer that could have had wider implications to the independence and operations of the Festival," the board's chairman Ian Kew said in a statement.
"Attempts by the board to enter into negotiations around these terms were declined."
Mr Kew said the event's future was "secure" but did not elaborate on whether any alternative funding was in the works.
'Ethical sponsorship framework' at centre of dispute
According to the Darwin Festival's website, its major partners for 2022's event included Santos and another gas company, Inpex.
It also received support from the Northern Territory government, City of Darwin and a number of other organisations including the Chinese government-backed Landbridge, which holds a 99-year lease over the Port of Darwin.
Both the Darwin Festival board and Fossil Free Arts NT highlighted conditions that came alongside the $200,000 funding envelope as behind the disagreement.
Fossil Free Arts NT spokesperson Anna Weekes said the conditions would have prevented other fossil fuel companies from being associated with the event, including Inpex.
She said she hoped it would have prompted the festival to "take the lead and adopt an ethical sponsorship framework".
"I think there were more opportunities and it's a real shame that the festival weren't able to consider these."
Ms Weekes said accepting the deal would have put the festival a few years ahead of the game.
"In a couple of years they're going to have to get rid of all their fossil fuel sponsorship, it will not be acceptable," she said.
"It's not acceptable now, nationally and internationally arts organisations are dropping this sponsorship, it's as gross as tobacco sponsorship."
