An outgoing Prime Minister does not, however, have the power to appoint his successor, and the following day O'Neill delayed his own formal resignation.

During his first tenure, which was marred by fiscal problems, he oversaw an austerity program, infrastructure projects and the devaluation of the kina.

In 1980, he also ordered the deployment of the Papua New Guinea Defence Force to support the government of Vanuatu against rebels during the Coconut War, in what was the first overseas operation by the PNGDF.

[8] He succeeded Prime Minister Paias Wingti in August 1994 and took office on the dual platform of national security and appropriate economic management.

Chan was defeated in the national election in June 1997 and was succeeded as prime minister by Bill Skate on 22 July 1997.

[7] During the "horse trading" phase of negotiations following the 2007 general election, Chan was nominated for the position of prime minister, with the backing of Mekere Morauta and Bart Philemon, as an alternative to the large National Alliance grouping which appeared likely to again be led by Somare.

[14] His son Byron Chan was Member of Parliament for Namatanai Open electorate, covering the south of New Ireland from 2002 until 2017.

[18] The Papua New Guinean government declared a one-week period of national mourning over his death[19] and granted Chan, whose remains were transported to Port Moresby,[20] a state funeral on 2 February.