East Timor President Jose Ramos-Horta has moved to clarify reports he has rejected an Australian bid for an immigration detention centre in his country.

Fairfax Media reported Dr Ramos-Horta had told journalists in his country that East Timor wouldn't agree to the centre.

Immigration Minister Chris Bowen as recently as Wednesday confirmed that talks were continuing with the East Timor government on setting up a centre and that Dr Ramos-Horta believed it was still a possibility.

A spokesman for the president told AAP on Friday that while East Timor would not agree to a regional centre on a bilateral basis, Dr Ramos-Horta had not rejected the concept altogether.

"As the president has said before, East Timor would never turn its back on asylum seekers," the spokesman said. "But this is not a bilateral matter. It can only be resolved on a regional basis and through discussions through organisations such as ASEAN, which East Timor hopes to join this year or next year, and with groups such as the United Nations."

The spokesman said many questions remained, such as where a detention centre would be built and how it would be funded. And the Timor government would set limits on it, such as a cap of 200 detainees and a detention period of no more than six months.

Opposition Leader Tony Abbott said it was time to scrap the plan. "It was always a flight of fantasy, it was always just a confection designed to get the government through an election campaign," Mr Abbott told reporters in Alice Springs on Friday.

He said Prime Minister Julia Gillard should ask Nauru to reopen the centre funded by the Howard government. The government has rejected reopening the Nauru centre as the tiny nation is not a signatory to the United Nations protocols for refugees.