The Papua New Guinea government has filed an application in the Singapore courts to stop the PNG Sustainable Development Programme Ltd from disposing of its assets.
It has also called for the court to appoint independent receivers to manage these assets.
The Attorney General Kerenga Kua says the government had to act to preserve the company's assets, which are in excess of 1.4 billion US dollars.
He says the money is being held in trust by the company for the people of Western Province and the rest of Papua New Guinea.
But the company says the Attorney General's statements are inaccurate and defamatory and it will resist the government's application vigorously.
The chairman of the PNG Sustainable Development Programme, Sir Mekere Morauta, says it is highly inappropriate for the Attorney-General to comment on matters that are still before the Singapore High Court.
