China Petrochemical Corp., known as the Sinopec Group, is in advanced negotiations to buy a stake in Portuguese oil company Galp Energia SGPS SA's (GALP.LB) Brazilian unit, people familiar with the matter said Friday.

The current discussions center on a transaction worth at least EUR2 billion, according to a person familiar with the matter.

Although discussions are ongoing, Sinopec is closing in on the stake and has emerged as the front-runner, said two people familiar with the talks.

The Chinese company is likely eyeing Galp's partnership with Brazilian state-run oil company Petroleo Brasileiro SA (PBR, PETR4.BR), which is making big investments in discovered offshore oil fields in Brazil.

Galp is seeking the foreign investment to help finance the project.

The company, whose main shareholders are Eni SpA, (ENI) Italy 's biggest oil company, Portugal 's Amorim Energia BV and Portugal 's government, is being advised by JP Morgan Chase & Co. (JPM), UBS A.G. (UBS) and Bank of America Corp., (BAC), people familiar with the matter said.

It is unclear whether any other companies are bidding for the asset, but people with knowledge of the negotiations said Sinopec was the most likely buyer.

Sinopec didn't respond to repeated requests for comment.

Last week, Galp President Manuel Ferreira de Oliveira said bidding, which closed in September, has been competitive. The size of the stake in the unit and the final value is still under discussion, a person familiar with the situation said. Galp has said it will decide on the buyer this month.

Sinopec's interest in Galp Energia's unit underscores both China 's continued hunger for overseas oil and gas assets and supply its own economy, and the growing attractiveness of Brazilian oil assets.

Brazil is an increasingly important target for Chinese investment.

In 2010, Spain 's Repsol SA sold 40% of its Brazilian assets to Sinopec for $17.8 billion.

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