Immigration Minister Peter Dutton has confirmed to Sky News that Australia will work with the Papua New Guinea govenremnt to close down Manus Island detention centre.

'We will work with the PNG government to close the Manus Island Detention Centre and I think that's a good outcome,' he said.

'I think it's a great announcement because we've been able to close 17 detention centres on the mainland, In Australia and we've done that because we've stopped boats.'

Mr Dutton was quick to reiterate that despite the closure of Manus, Nauru will still remain up and running.

'We remain committed to keeping Nauru open, it is absolutely necessary in making sure we can keep the boats stopped.'

Mr Dutton confirmed that the over 960 people still on Manus Island will 'under no circumstances' be resettled in Australia he added that it's important that people in the detention centre 'hear this message.'

'We will work with those people to help them settle into PNG, to help them return back to their country of origin,' but the Minster said that there was no third country option at this time.

Earlier Immigration Minister Peter Dutton met PNG Prime Minister Peter O'Neill in Port Moresby to talk about shutting down the centre, following a PNG Supreme Court ruling it was illegal.

Mr O'Neill said a number of options for closing down the centre were being canvassed and further announcements would be made soon.

'Both Papua New Guinea and Australia are in agreement that the centre is to be closed,' he said in a statement.

Mr O'Neill said he was satisfied that officials from both sides were making progress but it was important the process was not rushed.

'This must take into account the interests of the people of Papua New Guinea and the wellbeing of asylum seekers and refugees.

'The Supreme Court has delivered its ruling and our government is complying with this decision.'