An agreement has reportedly been reached between a group of Vanuatu landowners and a New Zealand investor who has paid for a land lease.
This follows reports that people attending Vanuatu's national land summit this week were shocked to hear that a small island had been sold for about 2,300 US dollars to a New Zealander.
Sources from Malekula say a New Zealander called Guy Jacobson purchased Pakatel island without the knowledge of the traditional landowners.
Our correspondent, Len Garae, says the buyer recently attended a customary ceremony with the landowners to agree to fairer terms of the lease.
"By means of building them proper infrastructure as well as schools for the children and they have agreed to that. And so that is the new deal now and he has assured them he will not sell the lease to anyone else while they are working in partnership with him on the project to build a resort and a wharf on the small island."
Len Garae says claims the island lease has now been sold to Australian investors over the internet are false.