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Malaysia’s state oil giant Petronas is close to clinching a $1.6 billion deal for a 25 per cent stake in the ammonia unit of India’s AM Green, according to a Bloomberg report.

Petronas is in an advanced state of negotiations that value AM Green at $6 billion, the report said citing people in the know of thngs.

However, even though discussions are at an advanced stage, they could still be delayed or not come through at all, the report cautioned.

Earlier this year, there were also reports that Petronas was competing with global rival BP to invest $1.5-2 billion for a significant minority stake in AM Green, a new platform wholly owned by the two founders of Greenko, Anil Chalamalasetty and Mahesh Kolli.

Greenko was expected to select one of the two energy majors.

The development comes at a time when global investors are keen to invest in the green sector of the fast-growing Indian economy which has to meet its targets to fight climate change. French oil giant Total this week announced plans to invest $300 million in a joint venture with Adani Green Energy Ltd for solar and wind projects.

Saudi Arabia’s sovereign wealth fund is also looking at opening an office in India as the kingdom is keen to invest in sectors including green energy and petrochemicals.

Petronas had also offered $460 million to buy a 20% stake in the green energy arm of India's largest power producer NTPC earlier, but India’s public sector power behemoth opted out of the deal.