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A mission is under way to rescue an Australian professor and three local researchers being held hostage by an armed group in Papua New Guinea (PNG).

Police chief David Manning said security forces would use "whatever means necessary" up to and including lethal force to free the group.

The team were on a field study trip in remote highlands when they were captured, on an unspecified date.

A ransom has been demanded for their release, local officials say.

The Australian Broadcasting Corporation has reported that a larger group was initially kidnapped and some local guides have since been released.

The four people being held captive are the professor, who is an archaeologist from an Australian university, and three university students from PNG.

The police chief said overnight the kidnappers were "opportunists" who had "obviously not thought this situation through".

"We are offering the abductors a way out," he said.

"They can release their captives and they will be treated fairly through the criminal justice system, but failure to comply and resisting arrest could cost these criminals their lives."

PNG Prime Minister James Marape on Monday said authorities had been having "running conversations" with the kidnappers and he sought to reassure families of the hostages.

"I'm confident, I'm optimistic, I'm prayerful that we get… them out," he said.

Australia's Department of Foreign Affairs and Trade is yet to comment.

Earlier this month a New Zealand pilot was taken hostage by separatist fighters in Indonesia's nearby Papua region. Philip Mehrtens will be held until demands for Papua's independence are met, the group say.