MUMBAI (Reuters) - Bharat Petroleum Corp. Ltd. is in talks to buy a stake in Singapore Petroleum Co. Ltd., a senior official at the Indian state-run refiner said on Monday.

He was responding to a report in the Financial Express newspaper which said both BPCL and another state-run refiner Hindustan Petroleum Corp. Ltd. were pursuing separate plans to buy a stake in the Singapore company.

The BPCL official, who declined to be named, did not give details of the size of stake being sought and said the company's discussions with SPC were at a very early stage.

The paper said BPCL Chairman Ashok Sinha had met SPC Chairman Choo Chiau Beng recently and discussed the acquisition of a partial stake in the Singaporean oil company.

"BPCL has also agreed to select SPC as its counterparty for hedging and risk management. A proposal to trade crude and petroleum products with each other has also been made," the newspaper said.

When contacted, an HPCL official said the company had started talks with SPC in December 2004 but nothing much had materialised since then.

The newspaper said Singapore's strategic location at the entrance of the Strait of Malacca was of great interest to India as it was an important oil transit route for Asia-bound oil and also for refined products from the Gulf.

Indian Oil Corp. Ltd. is also in talks to buy a 26 percent stake in Singapore Petroleum, sources had said in June.

Singapore's state-linked Keppel Corp holds 49 percent of SPC. A consortium of Indonesian investors owns about 27 percent of SPC through unlisted Satya Capital and Kapital.

Indian oil companies are looking for investment opportunities overseas to secure oil supplies.

IOC has bid for a 51 percent stake in Turkish oil refiner Tupras.

The HPCL official declined to comment on specific proposals but said the company was actively scouting overseas.

© Reuters 2005. All Rights Reserved.

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