British oil and gas firm BG Group is likely to sell its stake in offshore Gujarat block CB-OS/1 to Hindustan Oil Exploration Company.

"BG is close to selling its 62.64 per cent stake in the Cambay basin exploration block CB-OS/1 to HOEC. Talks have progressed well and the sale is likely to take place soon," industry sources said in New Delhi.

They, however, could not give the amount for which BG was selling its stake in the block.

HOEC holds 17.36 per cent stake in the block where BG had encountered marginal presence of hydrocarbons in three wells it has drilled so far.

Tata Petrodyne and Oil and Natural Gas Corporation have 10 per cent a piece in the block.

When contacted, BG India director Pravin Tandon declined to comment on the issue saying "it is not our corporate policy to comment on acquisitions and sale."

BG Group was exiting CB-OS/1 as "the potential in the block was not in conformity with the oil and gas portfolio held by the group," sources said.

HOEC officials were unavailable for comments.

A senior BG official said the firm has written to Director General of Hydrocarbons (DGH) that it was no longer interested in development of CB-OS/1 exploration block in the Gulf of Cambay.

Sources said BG, which had invested close to $20 million in the Cambay block, wanted to exit it as the three-well drill programme had not yielded significant hydrocarbon discovery.

While the first well drilled in April-May last year struck small quantities of oil, the other two reached 2000 metres depth but did not give satisfactory results.

British Gas had last year bought out Enron Oil and Gas India Ltd's entire 30 per cent holding in Panna-Mukta and Tapti offshore fields and 62.64 per cent stake in CB-OS/1 exploration licence for $350 million.

It currently is in-charge of operations of the 27,994 barrels per day and 86.22 million cubic feet per day Panna-Mukta oil and gas field and 184.74 million cubic feet per day Tapti gas field.

ONGC (40 per cent) and Reliance Industries Ltd (30 per cent) are its partners in the field.