What Australia really needs right now is a new US military base:

The United States will build a new communications base in Australia, the first since the Pine Gap spy base began operating in the Northern Territory more than 20 years ago.

The new communications base will be built at Geraldton, 370km north of Perth, and will provide a crucial link to two geostationary satellites enhancing US military capability in Asia and the Middle East, Fairfax newspapers reported.

Firm plans for the base come after three years of secret negotiations between Washington and Canberra, Fairfax said.

The base will be a key component of a system carrying orders and intelligence to US and allied troops in the field in some of the world's major trouble spots.

Construction could begin within months, the report said.

The deal further entrenches Australia's military relationship with the United States, an expert said.

A visiting fellow with the Australian Defence Force Academy, Philip Dorling, it would be almost impossible for Australia to be fully neutral or stand back from any war in which the US was involved, the Fairfax report said.

Defence Minister Brendan Nelson confirmed talks with the US Defence Department about the base were continuing.

The new base would be built on defence land and the government would ensure it had full knowledge of the base's operations, Dr Nelson said.

More bases could be built at other Australian locations, he said.