s PORT MORESBY (Reuters) - Papua New Guinea was in a political deadlock on Tuesday with two prime ministers claiming the right to govern the resource-rich South Pacific nation, prompting calls for calm in the capital Port Moresby.
PNG's Supreme Court on Monday night ruled the government led by Peter O'Neill illegal and ordered Sir Michael Somare, toppled while receiving medical treatment in Singapore, be reinstated as prime minister.
O'Neill refused to step down and had parliament again elect him prime minister late on Monday, but heavily armed police prevented him from reaching government house to be sworn in.
"We are deeply concerned about the situation. There are heightened political tensions within Port Moresby with two, as it were, alternative prime ministers. This is unknown terrain in Papua New Guinea," said Australian Foreign Minister Kevin Rudd.
"We have been urging calm on the part of all parties. The Papua New Guinea Defence Force has been directed to remain in barracks...Violence would help nobody," Rudd told Australian radio.
O'Neill convened parliament on Tuesday. Local media said the parliament speaker announced that O'Neill was the legitimate prime minister, contradicting the Supreme Court. Somare and his supporters were camped across town in a beachside hotel in Port Moresby, but declined to comment.
Governor General Michael Ogio was seeking legal advice as to who is the legitimate prime minister and will not swear in either man on Monday, his office said.
"Due to what happened yesterday there will not be any swearing in today," said Ogio's press officer.
Moresby was calm with packed commuter buses ferrying people to work in the dusty port and markets selling fruit and vegetables and betel nut were crowded.
"There is no fear of anything happening. Commuters are going to work and the markets are full," said a resident.
Talkback radio callers generally supported the court ruling, with some saying even if Somare only has minority support in parliament he should be allowed to rule as elections are only six months away in June 2012.
PNG, a country where the majority of people live subsistence lives despite its abundant mineral wealth, has a turbulent history and corruption is rife.
A 12-year secessionist rebellion on the island of Bougainville, the longest running conflict in the Pacific, forced the closure of the giant gold and copper Panguna mine.
The rebellion also saw the army topple the government in 1997 for bringing in mercenaries to try to end the Bougainville conflict, which ended with a peace treaty in 2001.
Despite PNG's robust politics, which have seen governments in the past toppled as lawmakers change party allegiances, the nation's "golden goose" resource sector has largely been left unhindered by the turmoil.
PNG's economy is tipped to grow 7.8 percent next year, driven largely by the construction of a massive liquefied natural gas project.
"The overall economic development of Papua New Guinea has been strong," said Rudd. "The resource projects being developed are destined to bring significant revenue to the government of Papua New Guinea."
U.S. oil giant ExxonMobil leads a consortium building the country's biggest-ever resource project, a $15.7 billion LNG project due to come on stream in 2014. The project is expected to produce 6.6 million tonnes per annum and could see GDP increase by 20 percent.
The Supreme Court on Monday ruled that the O'Neill government had no right to take office while Somare was out of the country receiving treatment for a heart ailment.
The court said Somare's absence overseas in Singapore for five months this year did not mean he had vacated the prime ministership. O'Neill took office in August.
The ailing Somare, 75, said before the judgment that he was willing to govern the country. However, Somare's party has suffered mass defections and is now in a minority in parliament, leaving some question over whether he could cobble together a governing coalition.
PNG's longest-serving prime minister, affectionately known as "the Chief" after leading the country to independence in 1973, has left open the question of whether he would run at the next elections due in mid-2012.
(Writing by Michael Perry; Editing by Ed Davies)