Then Prime Minister Sir Julius Chan, Deputy Prime Minister Chris Haiveta and Defence Minister Mathias Ijape were cleared of wrongdoing in a Sandline commission of inquiry after protests after the mercenary affair.
However, both Chan and Ijape along with many other cabinet ministers were subsequently defeated in the June general election amid a backlash from voters.
Prime Minister Bill Skate has established a new Sandline commission of inquiry with wider terms of reference.
Sir Wiwa Korowi said he had launched Operation Brukim Skru at Government House on 19 November 1996 with other Christian leaders from all denominations to bring Papua New Guinea "before God for His divine intervention for the evils of our time".
He said the prayer group was aimed at "getting all Christians to take this country to God, through prayer, fasting, dedication and humility".
"This is a practical interpretation of what we have inscribed and incorporated into our constitution," he said.
"As a member and participant of Operation Brukim Skru, I wish to stress that the players in the Sandline saga must not touch nor imply Operation Brukum Skru was party to the Sandline deals," he said.
"Unfortunately, NIO was carrying out its character assassination on me personally, Government House and that of the Christian community throughout Papua New Guinea who particpated in the Operation Brukim Skru prayer program.
"NIO has got very pathetic lying habits and they are out to create sensational stories to carry out character assassination on people.
"I want the facts to be proven by NIO. They cannot get away with this flattering lie at the expense of someone's credibility," he said.
Korowi vowed that the prayer program would continue to "fight corruption and manipulation" of the system of government.
Political observers said the NIO - reported to have Australian and Indonesian advisers - had a reputation for running smear campaigns, particularly against non-government organisations.
Newspaper reports said the NIO document described Operation Brukim Skru as an "anti-corruption" lobby linked with NGOs such as Melanesian Solidarity (Melsol) and the Individual and Community Rights Advocacy Forum (ICRAF) which were prominent in protests against the Sandline mercenary contract.
According the NIO document, Brukim Skru was a cross denominational group formed by the governor-general and allegedly included Chief Justice Sir Arnold Amet, Sir Anthony Siagaru, Gabriel Dusava, Ted Diro and Jerry Singirok.
"There is nothing wrong with this religious organisation but information available indicates some in it may have political ambitions," the NIO document claimed.
Major players in prayer group seemed to believe they had a God-given right to rid PNG of what they perceived to be a corrupt government, the document said.
"What is of concern is the unconstitutional method by which this seems to have been approached," it claimed.
"It is legitimate speculation that all this could be a deliberate plot perpetrated by politically minded Christians, riding the wave of anti-corruption sentiments and using the Sandline issue, and even possibly Singirok himself, as a means to further their political ambitions via unconstitutional method or plan, as discussed in January, are linked to Brukim Skru."
David Robie is a New Zealand journalist and author specialising in Pacific affairs. He is currently lecturer in journalism at the University of Papua New Guinea