Manus Island landowners say the Papua New Guinea government has seven days to meet demands for 47 million US dollars in aid and building contracts or they will take legal action against a proposed refugee processing facility.
They say they want to meet with representatives from both Australia and PNG within the week for fear they will miss out on the economic spin off from the deal.
The interim chairperson of the Pwahalopu'un development company, Mary Handen, says they have the right to the land.
She says the whole issue is about the local people people getting some of the spin-off benefits from the project - in terms of contracts.
The Howard-era Manus facility closed in 2004 and the site has fallen into serious disrepair since.
Both the landowners and local MP Ronny Knight fear any spin-off benefits coming to the island as a result of the deal will boomerang and head straight to the PNG mainland or back to Australia.
Last week, the provincial government said it was prepared to take the landowners to court over their opposition.
The government says land for the centre is government land.