‘Ned’ Kelly decapitation

Parts of Darwin are in lockdown as Northern Territory police search for a fugitive accused of beheading NSW man Edward Kelly.

The horrific killing of Mr Kelly – known as Ned Kelly – last Thursday shocked the small north coast town of Broadwater in northern NSW.

The 54-year-old, described as a quiet, gentle soul who kept to himself, was reportedly found with a hat in place of his head in his ramshackle home.

Today police issued an arrest warrant for a suspect, 46-year-old Jonathon Stenberg.

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“A vehicle believed to have been driven by Stenberg has been seized by police about 50 kilometres south of Darwin, and a search of the surrounding area is currently under way,” a police spokesman said.

Northern Territory Police Commander Richard Bryson said people who lived in the cordoned-off area on Darwin’s rural outskirts should be on alert.

“Make no mistake, this is a very serious situation,” Commander Bryson said.

“In police terms, this is as serious as it gets,” he said.

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He said people who lived in the affected area should try to make arrangements so they did not have to return home.

Mr Stenberg is described as solidly built, about 168cm tall, with brown hair and brown eyes.

His car contained a long-arm firearm but it was suspected Mr Stenberg also had access to handguns, police said.

Anyone who sees him is urged not to approach him, as he may be armed. Instead, immediately contact Triple Zero (000) or Crime Stoppers on 1800 333 000.

Detectives from State Crime Command’s Homicide Squad have formed Strike Force Fitzsimonto investigate the killing.

with AAP

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