CANBERRA, May 3 (Xinhua) -- The Australian government has committed 50 million Australian dollars (37.4 million U.S. dollars) to launching the nation's first space agency.

The seed funding forms part of the upcoming federal budget which will be handed down by Treasurer Scott Morrison on May 8.

The government has not decided where the agency will be headquartered, with Western Australia (WA), South Australia (SA), the Northern Territory (NT) and Australian Capital Territory (ACT) having all expressed interest.

Megan Clark, former head of the Commonwealth Scientific and Industrial Research Organisation (CSIRO) and leader of a government review into the space sector, will lead the new agency for its first year of operation.

Anna Moore, a professor at Australian National University's College of Science and contributor to Clark's review, welcomed confirmation of the funding.

"The 50 million Australian dollars injection is a great start for setting up the agency itself," Moore told the Australian Broadcasting Corporation (ABC) on Thursday.

"Australia is at the perfect time to jump in and grab part of this market because it is changing. There is industry here already but it's all at a very low level, there's nothing coming up."

The establishment of the agency was announced in September 2017 to bring the country up to speed with countries like New Zealand and Canada who have already had their own agencies.

Prime Minister Malcolm Turnbull conceded at the time that it would be "small" but would help Australia move into the lucrative space industry.

Bank of America Merrill Lynch in 2017 estimated that the industry would be worth more than 3.5 trillion Australian dollars within three decades.

Brad Tucker, an astrophysicist at Australian National University, joined Moore in welcoming the announcement.

"We can be putting things into space and we should be," he said.

"We're well placed geographically for communications and for launch sites and we're well placed for creativeness in our people -- and that's what you want in a space agency."