Armed landowners in the Papua New Guinea highlands say they have blocked access to gas wells because of an ongoing dispute with the Government over the payment of royalties.
The landowners in PNG's Hela province have cut down trees and blocked roads and say they have stopped police from taking back control of the area.
They are demanding the PNG Government pay them outstanding royalties, which are the subject of a protracted legal dispute.
"They have cut down trees from wellhead B to G, blocking the roads," said Dickson Ango, the chairman of one of the petroleum development licence areas.
"The security personnel have withdrawn and landowners have taken control of that area."
Mr Ango said the landowners were protesting the PNG Government's failure to pay a promised 20 million kina ($AUD8 million) in royalties for the gas.
They promised to pay to the landowners — they even wrote a dummy cheque and gave it to the landowners — but that money was not in the account," Mr Ango said.
"They showed us the cheque and they said, you see it, you feel it, you touch it and then they withdraw it and they never pay it to us."
The PNG Government has previously said it cannot pay royalties to some landowner groups because of disputes over clan vetting and an ongoing legal case.
It has been negotiating with landowners in an attempt to resolve the disputes and prevent unrest at the project and along the pipeline.
The operator of the PNG Liquefied Natural Gas project, ExxonMobil, said its production was continuing at normal levels, but it has withdrawn all non-essential staff from the area.
"ExxonMobil PNG is continuing to monitor ongoing tension in the Highlands (Hides, Angore, Komo) areas," a spokeswoman said.
"Staffing at the Hides Gas Conditioning Plant remains at essential personnel only.
"The Hides Gas Conditioning Plant is operating safely at normal production levels."
Police in Hela Province were not able to be reached for comment.
A spokesman in Port Moresby said officers there were trying to resolve an unrelated dispute involving the hijacking of trucks as part of a compensation claim over the death of a young man in a traffic accident.
Hela Province has been the scene of some of PNG's worst tribal fighting over the past four years, with provincial authorities estimating at least 200 people have been killed.