Nauru has room for the 850 men from Manus Island’s detention centre, Immigration Minister Peter Dutton says, but he is stressing the Australian government remains in talks about the options available in Papua New Guinea.

PNG’s Prime Minister Peter O’Neill on Wednesday announced the centre would close after the Supreme Court’s ruling on Tuesday, saying he would “immediately ask the Australian government to make alternative arrangements for the asylum seekers”.

Mr Dutton is highlighting the potential for fresh talks with Papua New Guinea to provide a resolution.

• Refugee sets himself on fire
• PNG to shut Manus Island detention centre
• Aussie doctor named on IS ‘kill list’

“There is capacity [on Nauru] but we’re talking with the PNG Government about what options are available in PNG and we’ll continue those discussions with them,” Mr Dutton told Sky News on Thursday morning.

PNG’s High Commissioner to Australia Charles Lepani said the centre would not close immediately and there will be meetings in Canberra next week.

“We will talk with our Australian counterparts, which will be as early as next week with officials meeting in Canberra to discuss plans to close the facility,” he said.

Labor’s immigration spokesman Richard Marles wants the Australian government to try and convince the PNG Government to keep the centre open.

He has suggested negotiating with Mr O’Neill about changing the country’s laws to make detention legal or offering more money.

“All of those options need to be talked through with the PNG Government,” he said.

PNG has asked Australia to shut the centre. Photo: AAP

Manus Island MP Ronnie Knight told Radio National he expected Australia to keep funding projects it agreed to as part of the detention centre deal.

“Fulfilling their part of the agreement to continue to finish our roads and do what they promised,” he said.

He warned of consequences if Australia withdraws from those projects.

“If they do that then maybe next time down the track when they ask for help again it might be the other way around. We won’t assist them,” he said.

Manus Island concerned about centre closure

Manus Island locals are concerned about their future as the centre is the island’s largest employer, with many coming from outlying islands or other parts of Papua New Guinea, and it is a major customer for local businesses.

“I think it’s a definite blow,” resident Garry Korup said.

“We ordinary people of the island haven’t experienced such cash flow from an impact project since 1975.

“However, now that it’s closed we’d like the Government to have alternatives. How do we go on to make a living?”

Many residents of Manus Island were initially unhappy with the decision to reopen the centre, and were angry at Australia for sending people it did not want to PNG.

But some of the Australian aid packages from the regional processing deal did filter through to Manus.

– ABC