The Australian directors of a timber business in Papua New Guinea are suing the News Corp-owned Post Courier newspaper for $60 million over allegations of links to terrorism.

An Australian-owned logging company in Papua New Guinea has denied allegations of links to terrorism and demanded an apology from the newspaper that published the claims.

The next day it published a story quoting the PNG prime minister, who identified the company as Cloudy Bay Sustainable Forestry and announced an investigation into the alleged links.