Required for the biosynthesis of sulfolipid-1 (SL-1), a major mycobacterial cell wall lipid (PubMed:17259623, PubMed:17592143, PubMed:22194604). Catalyzes the acylation of trehalose-2-sulfate-2'-palmitate (SL659) by adding the (hydroxy)phthioceranoyl group at the 3'-position to yield the diacylated intermediate 2-palmitoyl-3-(C43)-phthioceranyl-alpha, alpha'-D-trehalose-2'-sulfate (SL1278) (PubMed:17592143, PubMed:22194604). a (hydroxy)phthioceranyl-[(hydroxy)phthioceranic acid synthase] + 2'-palmitoyl/stearoyl-2-O-sulfo-alpha,alpha-trehalose = a 3'-(hydroxy)phthioceranyl-2'-palmitoyl/stearoyl-2-O-sulfo-alpha,alpha-trehalose + holo-[(hydroxy)phthioceranic acid synthase]. kcat is 0.12 min(-1) with trehalose-2-sulfate-2'-palmitate as substrate. Up-regulated by the PhoP/PhoR two-component system. Null mutant does not produce SL-1 (PubMed:17259623, PubMed:17592143). Disruption of the gene does not alter the virulence of M.tuberculosis in mice (PubMed:17592143). Belongs to the PapA acyltransferase family.