Refugees on Manus Island will be resettled on Papua New Guinea's mainland but won't be allowed to become citizens or own land for eight years.
The Australian government welcomed a decision by PNG on Friday to begin resettling refugees processed from the island's immigration detention centre.
"The PNG government has shown ... its commitment to permit those found to be refugees to get on with their lives and have a fresh start in this dynamic nation with a growing economy," Immigration Minister Peter Dutton said on Friday.
The refugees have been processed under a regional resettlement arrangement negotiated by the Rudd government in mid-2013 and aimed at stemming the flow of asylum-seeker boat arrivals.
Opposition immigration spokesman Richard Marles said the arrangement had the biggest single impact on stemming the flow and preventing deaths at sea.
But the fact that not a single refugee had been resettled in PNG was evidence the coalition had mismanaged an important bilateral relationship and failed to actively engage with Port Moresby, he said.
According to a leaked transcript of a video message recorded by PNG deputy chief migration officer Esther Gaegaming, obtained by AAP, none of the refugees will be resettled on Manus Island.
Instead they will be relocated eventually to the mainland.
Refugees will undergo a course called Wei Bilong to build their English and Tok Pisin language skills and understanding of PNG society and culture.
They will be offered opportunities to do voluntary work to "contribute meaningfully to their local community".
A recruitment agency has been engaged to help refugees find work and they will also be given assistance to relocate.
Initially, they will be housed in guesthouse accommodation and assisted to find long-term housing.
"Accommodation can be expensive in some parts of PNG so initially you may need to share with other refugees or with Papua New Guineans," Ms Gaegaming says.
Refugees will receive some basic food and household items and will get temporary assistance to cover medical expenses in the first six months.
After refugees find a job they will be allowed to bring family members to join them in PNG.
They won't be eligible for citizenship for eight years. After that they will be able to vote, own land or run for public office.
The message urged refugees refusing to move out of the detention centre to the transit accommodation centre on Manus Island because of safety fears to "start your journey towards your new life".
"If you choose not to relocate, you are choosing to deny yourself freedom," it said.
It reiterates Australian government policy that none of the refugees will ever be resettled in Australia.
Mr Dutton was asked about the government's provisions for gay asylum seekers resettled in PNG at a media conference in Brisbane later on Friday.
He said the Australian government was "sensitive to situations" where discrimination may occur and was able to provide support to people affected by such treatment.
However, he didn't elaborate as how it related to refugees in same-sex relationships once they were relocated to PNG.
"But in relation to Manus ... the management of the Manus regional processing centre is an issue for the PNG government," he said.
Foreign Minister Rimbink Pato said his country had a proud tradition of helping people in need.
But there were concerns about refugees taking jobs off locals.
"Settlement of refugees is not easy and we have to ensure refugees are not competing for employment and income earning opportunities with our citizens," he said in a statement.
PNG's refugee policy would also cover people from Indonesia's Papua provinces who had fled the trouble spot years ago.
The PNG government would start assessing more than 2000 applications from West Papuans seeking PNG naturalisation from next month.
