Australia's Prime Minister Malcolm Turnbull has spurned New Zealand's offer of 150 places for Manus Island refugees, saying settling them in New Zealand would be used as a "marketing opportunity" by people smugglers.

Mr Turnbull's comments come after New Zealand's immigration minister Michael Woods' office said an offer to take 150 refugees from Australia each year was still on the table if Australia wanted it.

Mr Turnbull told Australian media there had been discussions with New Zealand but it would not be asked to take any refugees after the closure of the Manus Island centre. 

"We have to be very clear that settlement in a country like New Zealand would be used by the people smugglers as a marketing opportunity," he told radio station 3AW.

Under the previous Labor Government in 2013, Prime Minister John Key agreed with Australia's Julia Gillard to take 150 refugees a year from Australia for two years. That agreement has never been called in.

A spokesman for Prime Minister John Key said Mr Key and Mr Turnbull discussed it in February, but had not had recent talks specifically about PNG's decision to close Manus Island this week.

Australia's Immigration Minister Peter Dutton said the deal signed by the previous Labor Government was effectively "a back door way to get into Australia" because of the open borders between the two countries.

Mr Tunrnbull has proposed asking other countries, such as the Phillipines and Malaysia to resettle some of the refugees. The decision to close the Manus Island centre following a ruling by the Papua New Guinea supreme court that it was illegal for Australia to detain the asylum seekers there.