A major earthquake with a magnitude 7.5 struck off Papua New Guinea and a tsunami warning was issued soon after.

The epicentre of Monday morning's quake was near the town of Rabaul in the northeast of Papua New Guinea, the United States Geological Survey (USGS) said. The monitor initally reported a 7.7 magnitude earthquake but later downgraded it to 7.5.

The Pacific Tsunami Warning Center in Hawaii said "hazardous tsunami waves are possible for coasts located within 1,000 km of the earthquake epicentre along the coasts of Papua New Guinea and the Solomon Islands".

The powerful quake struck at a depth of 40km and was followed by two further offshore earthquakes in the vicinity which measured 5.7 and 5.0 respectively.

In Rabaul, residents noticed the sea level rose slightly, prompting ocean water to flood the parking lot of a shopping center near the beach, the Associated Press news agency reported.

Mika Tuvi, from the Rabaul Hotel, told Al Jazeera that she and other staff members ran outside when the quake started - in case the building collapsed.

"The earthquake shook for about five minutes," she said, adding that she was not aware of any damage at the hotel or elsewhere.

Staff have since gone back to work, she said, adding that no guests had been at the hotel at the time of the quake.

Officials in the capital, Port Moresby, were working to contact their counterparts in the outer provinces, but there had been no reports of damage or injuries within an hour of the quake rattling the country.

Martin Mose, acting director for Papua New Guinea's National Disaster Center, told the AP that a tsunami of 0.5m was measured in the harbour of Rabaul.

Earthquakes are common in Papua New Guinea. The country lies on the "Ring of Fire" - an arc of earthquake and volcanic activity that stretches around the Pacific Rim.