Last year saw Peter O'Neill negotiate numerous hurdles and pitfalls to take (or retain, depending on your reading of the constitutional crisis in the preceding seven months) power as prime minister of Papua New Guinea.

He put together a coalition government comprising around 90 of 111 MPs, giving him a solid majority and creating a degree of accord in the Haus Tambaran unseen for a very long time. His erstwhile lieutenant, Belden Namah, retreated to the opposition benches and even confirmed his willingness to support a constitutional amendment to extend the grace period in which votes of no confidence in the government cannot be lodged from 18 to 30 months.

O'Neill's election victory was welcomed in Canberra, as evidenced by his visit there at the invitation of Prime Minister Gillard and by the inaugural visit to PNG by Foreign Minister Carr. During his time in the country, Senator Carr repeatedly expressed the warm feelings of the Australian Government towards the O'Neill Government and O'Neill personally. The bonhomie looked to be reciprocated, with Carr's previous sins apparently all forgiven.

But with the turning of the year, it appears the honeymoon period is over and it's business as usual in PNG politics. In the last couple of weeks, a number of challenges to the O'Neill Government have arisen that undermine what appeared to be a well constructed and fortified position in the political landscape.

First, we saw the return of Belden Namah to centre stage. With no apparent trace of irony, the Leader of the Opposition declared that he would 'ensure that the values of our nation's constitution are upheld' by challenging the legality of the processing centre which recently reopened on Manus Island. Although the Prime Minister has not commented on the proceedings, he is no doubt unimpressed, as is Charlie Benjamin, the governor of the province, who appears to have overcome any concerns of this type he may have had previously. The National Court has yet to set a date to hear the case.

Hard on the heels of this announcement came Namah's assertion that he was withdrawing opposition support for the extension of the grace period as a reflection of his concerns that the country was becoming a 'banana republic'.

Given the size of the Government's majority and the fact that those who signed up to the Alotau accords in August of 2012 so far remain loyal to O'Neill, it is quite likely that, while Namah can make things uncomfortable in the media and possibly on the floor of the House, he is not really in a position to do the Prime Minister any substantive political harm at this stage. Don Polye has confirmed that his party, the second-largest coalition partner, will support the extension of the grace period.

Having said that, some cracks are beginning to show in the Government's alliances. Earlier this month there was an announcement that the People's Party, led by Peter Ipatas (governor of Enga province) would merge with the People's National Congress, led by O'Neill, giving the PM a total of 40 MPs under his direct control. However, the Registrar of Integrity of Political Parties and Candidates, Dr Alphonse Gelu, has refused to accept this arrangement, citing non-compliance with section 52 of the Organic Law on Political Parties and Candidates, which requires that such a merger be agreed by an absolute majority of the members of each party and 75% of members who are MPs.

In the midst of all this, O'Neill found himself, along with at least two of his ministers and numerous senior officials, struggling to avoid becoming embroiled in the ongoing and increasingly bizarre Phocea affair. Namah has lost no time in making political capital out of it.

It is generally accepted that the Manus Island facility (which O'Neill has said he would like to see become permanent) is the glue of the Australia-PNG relationship, but there are likely to be other reasons why Canberra is keen to have Peter O'Neill leading government in PNG. O'Neill's generally favourable approach to Australia, particularly as compared with that of Namah or his predecessor Sir Michael Somare, is well known, although the recent furore over the travel ban imposed on Ross Garnaut appears to belie this somewhat.

Furthermore, there are a couple of issues on the horizon on which Australia will hope to have PNG's support. One is in counterbalancing Fiji within the Melanesian Spearhead Group – the collective response to the recent events surrounding the reform of Fiji's constitution is yet to be made known.

In addition, if the issue of independence for West Papua arises, Australia will be keen to see O'Neill maintain his position of seeking to work with Indonesia in resolving border issues and acting as a restraint on more radical suggestions. Decolonisation is already on the table this year in relation to French Polynesia, and 2014 marks the end of both the period covered by the Noumea Accord and the ten-year transitional period in Bougainville, so it is conceivable that the momentum could provide fuel for the ever smoldering fire of West Papuan independence, something Australia is keen to avoid.

Photo by Flickr user Julia Gillard