Before writing you an answer that says Papua New Guinea was never even mentioned in discussions about Federation, I decided to double-check the indices of a few of my reference books. I found two (count them: two!) mentions, in two separate speeches.

In a speech given by the Victorian Premier after the Intercolonial Conference in 1883, he said:

The whole of the delegates there [at the Intercolonial Conference] were at one with respect to the immediate annexation of New Guinea.

[...] the Northern delegates [...] seemed really more interested in having possession of New Guinea than any of the other islands. [the rest of us] told the Northern delegates that our object was not to acquire a greater territory.

There were other islands in the south-western Pacific Ocean that were higher priorities. This was in the context that one of the reasons for proposing federating the colonies in Australia was mutual defence - particularly against France, which had a lot of colonies in the Pacific Ocean. New Guinea wasn't seen as necessary for creating a defensive line against France.

A decade later, in 1890, the "father of Federation", Henry Parkes, gave a series of speeches at the Australasian Federation Conference, which included this single reference to New Guinea:

I have no doubt whatever in my mind that if there had been a central government in Australia - if Australia could have spoken with one voice in the year 1883, New Guinea would have belonged to Australia.

The idea of federation applied to the British colonies in Australia - which did not include New Guinea. New Guinea was seen only as a candidate for annexation by a colony or by a hypothetical federation. Basically, the Brits in Australia could see themselves taking over New Guinea, but could not see New Guinea governing itself, even as a state within an Australasian federation. So, it was never mentioned as a candidate entity to be included in the Federation.