The 49-year-old man attended Surry Hills police station on Sunday afternoon to speak to detectives.

He was later charged with murder and refused bail. He is due to appear in court on Monday.

It is understood he is not related to Quanne, 12.

Quanne went missing in 1998 after she left her family's home in Granville to go to school.

She was intending to catch a train from Clyde to Strathfield but did not arrive at Strathfield Girls High School and was never seen again.

Early on in the investigation, Quanne was feared to have been kidnapped but her disappearance was not reported to police for about 10 hours because the school believed she was probably sick at home.

In 1998, then premier Bob Carr offered a $200,000 reward for any information leading to Quanne's location or anyone involved in her disappearance.

Her body has never been found.

In 2015, police examined whether the remains of a young girl found in a suitcase on the side of a rural road in South Australia were Quanne's. They turned out to belong to Khandalyce Pearce.

Detectives from Rosehill Local Area Command, with assistance from the State Crime Command's Homicide Squad, recently opened Strike Force Lyndey to investigate the matter again.

Rosehill Superintendent Scott Whyte will address the media at 9.30am.

"The Diec family have been informed of the arrest and have requested their privacy be maintained," police said in a statement.

More to come