An arrest warrant has been issued for Papua New Guinea's treasury secretary Diari Vele over allegations of corruption in the purchase of two Israeli gas turbines.

PNG's anti-fraud squad said it will arrest the Vele, who is known to have considerable control over the day-to-day running of the country's economy, when he returns to the country.

He is reportedly in Australia and will be going to Fiji for official government meetings.

The corruption charges relate to the purchase of two diesel generators from Israel at a cost of $US24 million last year.

The purchase was allegedly requested by prime minister Peter O'Neill to alleviate PNG's power shortages.

Vele denied reports he is running away from the charges.