Both domestic and foreign investors would be targeted, quoted Dinh La Thang, PetroVietnam's chair, as saying on Tuesday.

"The project expansion is expected to finish in 2016 with an additional investment of $1 billion," he was quoted as saying at a briefing with domestic media.

He did not give any timing for the share sale or name potential investors.

The group said on Tuesday it had picked Japanese engineering firm JGC Corp as adviser for the plan to raise Dung Quat's capacity to 200,000 barrels per day from 130,500.

The refinery, located 880 km (550 miles) south of Hanoi, has been running above capacity since late last year, after builder Technip handed it over to PetroVietnam.

The refinery bought 8.3 million tonnes of crude oil between February 2009 and December 2010, 6.08 million tonnes of which was pumped off Vietnam last year, and turned out 7.2 million tonnes of oil products, the group said in a statement.

PetroVietnam has forecast it would produce 5.6 million tonnes of oil products this year.

Reuters - January 7, 2011