CANBERRA, May 22 (Xinhua) -- Recreational marijuana could be decriminalized in the Northern Territory (NT) as it looks to build on federal laws which have already legalized the drug as a medication.

NT Chief Minister Michael Gunner said on Tuesday that the territory's potential to cultivate hemp and medical marijuana would boost the economy, so they would look at ways to create their own marijuana industry.

Penalties such as jail or conviction with a criminal record would be removed under the government's proposed changes, however, the growth or leisurely use of the product would remain illegal.

Federal laws legalized the growth of medical marijuana in 2016, and earlier this year these regulations were widened to allow exports from Australia.

Gunner said that widening these regulations further would boost the economy and create jobs.

"We are going through a parliamentary committee process to look at essentially addictive behaviors and policies around that, which could include decriminalisation," Gunner told reporters on Monday night.

"We recognize we have got to do policy work, there seems to have been some good outcomes in having a health-based approach in other parts of the world that I am interested in." Gunner cited the 13 U.S. provinces which have decriminalised marijuana.

The Federal Government has the power to veto any decisions made by the NT, however a trial crop has been grown in Katherine, south of the capital city, Darwin.

So far the NT has not held discussions to legalise the use of recreational cannabis.