There are two people there having lunch.
lunch=lunches, no need to be plural in no.
There are=not Two there are;
there are there=superfluous is more than is necessary to describe the situation, not needed/wanted here.過多的,多餘的.
Hence:-eg:-
(1)They have lunch over there./Two have lunch over there.
over=prep,=on the far side of somewhere
(2)Two people are having lunch over(prep) there(=on the far side of somethere)