State-run PetroVietnam is in talks to sell a 49% stake in its Dung Quat oil refinery to three foreign companies, the refinery's director general said.

"We are trying to sell the stake as soon as possible, so that we will have funds for expanding the refinery," Nguyen Hoai Giang told Dow Jones Newswires Friday.

Mr. Giang said the parties involved haven't reached agreement on the issue he said is dominating negotiations: the refinery's value.

A person familiar with the situation said Friday that one of the three companies is state-owned Petróleos de Venezuela SA, the other two are from Japan and South Korea, and that it's likely all three will buy the stake jointly.

PetroVietnam, formally Vietnam Oil and Gas Group, has said it will use the money raised from selling the stake to expand the refinery's annual capacity to 10 million metric tons, or 200,000 barrels a day, from 6.5 million tons.

Dung Quat, the only refinery operating in Vietnam, It meets around one-third of the country's demand for oil products.

A feasibility study on the expansion will be completed by the end of this month, and the sale may take place after that, the person familiar with the situation said.

State media cited Mr. Giang as saying last month that the expansion of the refinery may cost between $1.5 billion and $2 billion, and will likely take five to six years.

Source: Dow Jones