A Singapore court has dismissed an appeal by the Papua New Guinea state in its bid to gain control of the Sustainable Development Programme Limited.
The former government of Peter O'Neill launched legal action over the matter in 2013 after its controversial take-over of a lucrative mine.
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In making its ruling, the Singapore Court of Appeal has upheld a court decision from a year ago which quashed the PNG government's claim to the Singapore-registered Programme.
The SDP holds a trust fund worth about $US1.4 billion intended for the people of Western province after the end of the operations at the lucrative Ok Tedi copper and gold mine.
Six years after Mr O'Neill's government expropriated the mine six years ago, the state has exhausted legal avenues and failed in its claim for control and oversight of the company.
The SDP was established in 2001 when mining company BHP Billiton divested its majority share in mine to the company which was established as an independent entity under Singaporean law and limited by guarantee.
The divestment followed legal action by Western Province landowners over extensive and long lasting environmental damage caused by the mine operations, particularly its riverine tailings disposal system.
Shortly after last year's Singapore court decision against PNG, Mr O'Neill was replaced by James Marape as prime minister, but state lawyers still proceeded with the appeal process.
The state had argued that it was entitled to control the programme, as enshrined in a "partly oral, partly written agreement". But the court found that no such agreement existed.
Following a bitter and expensive legal battle with the programme, the state has now been ordered to pay its costs.
SDP, in a press release, described the legal case as an expensive exercise where the money, spent by both the state and SDP could have been better directed towwards development programmes.
The SDP programme has a focus on projects to develop delivering health, education, livelihoods and enabling infrastructure in Western.
Its directors said they would continue to protect the long-term fund by defending the company against any future claims.