Reformed tropical cyclone Tiffany is set to track south of Groote Eylandt in the Gulf of Carpentaria, on Wednesday morning and intensify to a category two system before making landfall on the mainland.
The Bureau of Meteorology has a warning zone in place from Cape Shield in the Northern Territory to the Queensland border, including Groote Eylandt, Numbulwar, Ngukurr, Bulman, Port Roper and Port McArthur.
Communities in the warning zone have been told to prepare for wet and windy conditions, with shelters opening on Groote Eylandt and the mainland.
The Northern Territory Emergency Services said residents in Alyangula and Numbulwar should shelter indoors as the weather conditions worsen.
The GEMCO Mess is open to staff and Alyangula residents and shelters are open at the Angurugu School Trade Training Centre, Umbakumba School Trade Training Centre, Milyakburra Cyclone Shelter and Numbulwar School.
About 50 people used the shelter in Numbulwar on Tuesday night. Most residents on Groote Eylandt were staying in their homes with low numbers at public shelters.
Severe thunderstorm warnings linked to the cyclone have been issued for the Darwin, Daly and Arnhem areas with flash flooding likely.
The Bureau of Meteorology said that a 78 kilometres per hour wind gust was recorded at Tindal RAAF base near Katherine at 1.32am on Wednesday.
As of 3.30am Tiffany was a category one cyclone with sustained winds near the centre of 85km/h and gusts of up to 120km/h. It was about 95 km southeast of Groote Eylandt and 255 km east of Ngukurr moving west at 20 km/h.
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The BoM said gales were continuing near Centre Island and developing near Port McArthur and on parts of Groote Eylandt. They would extend along the coast to Port Roper and Numbulwar this morning and extend to Cape Shield later in the day.
The cyclone was expected to cross the coast at about midday on Wednesday around Port Roper and Nathan River, with destructive wind gusts up to 130 kmh.
Gale-force winds with gusts up to 100 kmh could reach the area east of Beswick late on Wednesday with the storm system expected to weaken below cyclone strength later today once it hits land.
The BoM said that a storm tide between the Queensland border and Cape Shield, including Groote Eylandt, was expected as the cyclone tracked towards the mainland coast.
The higher-than-normal tides would bring damaging waves and dangerous flooding in the warning area on Wednesday and early Thursday.
As the cyclone moves inland heavy rain was predicted for parts of Arnhem, Carpentaria and Daly districts on Wednesday and Thursday, with flood and rising rivers likely.
A flood watch remains in place for North West and Carpentaria Coastal waters and preparations being made to manage any flood events.
Northern Territory Police, Fire and Emergency Services have reminded residents to stay away from floodwaters and not attempt to cross or drive through floodways and to be CrocWise.
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