Ambushes blamed on separatist rebels have left three people dead including an Australian mine worker in the restive Indonesian province of Papua.

Drew Grant, 29, a prooject manager with the US mining giant Freeport was shot dead on Saturday just outside the company's huge Grasberg copper and gold mine.

On Sunday, gunmen opened fire on two Freeport owned vehicles, killing a security guard. When police and members of the Densus 88 anti-terrorism unit responded to that attack, a police officer was shot dead..

At least seven others were injured, in some of the worst violence in Papua, a highly militarised zone, since a mob demanding the closure of the mine hacked four people to death in 2006.

Mr Grant was on his way to a golf game with three colleagues when rebels opened fire on the car he was travelling in, shooting him five times in the head and neck. He had only been back in Papua for a week, after visting his wife Lauren and nine week old daughter Ella in Melbourne.

"Everyone's just distraught, finding it hard to comprehend," said Mr Grant's brother Nick. "We're all in shock. We're just trying to come to terms with what's happened and we'll worry about the details later," he said.

The following morning a security guard, working on a contract for Freeport, was killed when "shots were fired at two security vehicles", Freeport said in a statement.

National police spokesman Sulistyo Ishakhe said when police and the anti-terrorisim squad responded; "The attackers opened fire from distant hills, making it difficult for the police to return fire."

Indonesian authorities have blamed the attacks on rebels of the Free Papua Movement (OPM), which has sought independence from the central government since the 1970s.

Military-grade bullet casings found at the scene have led some to accuse the Indonesian military of being behind the attacks. But West Papua police chief Bagus Ekodanto insisted rebels using military-issue weapons planned the ambush that killed Mr Grant.

"He (Mr Grant) was shot five times in the neck, chest and stomach from a distance of 25 metres," said Mr Ekodanto."The shooting was planned," he said. "(It's) clear they were using weapons belonging to the police or the military."

The low-level insurgency for an independent Papua has been a source of clashes with government troops since the region was transferred from Dutch to Indonesian rule in the 1960s.

Since then, about 100,000 Papuans — the equivalent of a sixth of the current population — have died in military operations in the resource-rich mountain area on the western half of New Guinea island. The eastern half of the island is known as Papua New Guinea.

Freeport's operations in the region have been deeply unpopular amongst Papuans. The rebels regard the company as a symbol of Jakarta's rule and a symbol of the unjust division of resources between the capital and Papua, with the mine's profits being returned to Jakarta, 2300 miles away and to foreign investors while the majority of the population remain in poverty.

The Grasberg mine, which employs thousands of local workers, is majority owned by Freeport-McMoRan Copper & Gold Inc. of Phoenix, Arizona, which posted revenue of nearly $US18 billion ($A22.97 billion) for 2008. The Indonesian government holds a minority stake in the mine, which contains the largest recoverable reserves of copper and the largest single gold reserve in the world, according to Freeport's website.

Two Australian Federal Police officers have joined 40 Indonesian police and forensic specialists investigating the ambush, while doctors conduct an autopsy on Mr Grant.

Foreign Affairs Minister Stephen Smith said Mr Grant's death was "tragic", and offered his family the Government's condolences.

"The Indonesian police have advised Australian officials that they are treating this matter as a high-priority investigation," he said.

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