China National Petroleum Corp, the parent of PetroChina Co Ltd (HK 0857), will invest 3.6 bln usd to develop Block 14 of Iran's offshore South Pars gas field, China Business News reported, citing sources.

CNPC is in talks with Iran over the details of the project and is expected to sign a 7-year deal soon, the report said.

China's largest oil producer will invest 1.8 bln usd on exploration and another 1.8 bln usd to build a liquefied natural gas (LNG) plant with annual output of 4.5 mln tons, according to the paper.

Block 14 has natural gas reserves of 370 bln cubic meters, the paper said.

Block 11, which CNPC jointly developed with Iran several years earlier, and Block 14 will feed the LNG production component of the project.

Last month PetroChina told XFN-Asia that it has signed a preliminary 25-year agreement to purchase 3 mln tonnes per annum of Iranian liquified natural gas (LNG) from 2011.

China National Petroleum Corp is currently building three LNG terminals in Jiangsu, Dalian and Tangshan.