``We have decided to sell 50 per cent stake to a multinational player. Negotiations are under way with leading players in the world. We are not in a position to reveal any names at this stage,'' Century Gas & Petrochemicals chairman & managing director Vijay Tata said.

A consultant has recently been appointed to work out the price and other modalities of the sale. Since the company has lined up expansion plans in Rajasthan and Madhya Pradesh, the foreign partner's support will be crucial to providing quality, Tata said.

Century Gas entered the Mumbai market in 1995 just two years after the LPG industry was thrown open to the private sector. The company was pursuing an aggressive price strategy ofRs 140 for a 12 kg cylinder here till a few months back when it decided to increase the price to Rs 215. The company has a capacity of 1,60,000 cylinders per month.

Though private players like Century Gas and Leader Gas are holding talks with MNCs like Shell, the entry of Reliance Industries in the LPG retail market of Saurashtra and Maharashtra has intensified the competition.

Reliance, the bulk supplier of LPG gas, has priced the product at Rs 180 per 15 kg cylinder, probably the cheapest in the country. Once Reliance completes its expansion plans, private players will be forced to buy imported LPG from dealers like Hindustan Aegis at a much higher price, industry sources said.

Demand for LPG is forecast to increase worldwide to 240 million tonnes per year by 2005 from 160 million tonnes in 1995. This will come largely from the petrochemicals sector in the Middle East, while in Asia the demand will be mostly driven by the residential and commercial users, say analysts.

The largest importers in Asiahave been Japan and South Korea. However, the Asian meltdown has caused a negative growth leaving India as the most alluring new markets in Asia, they feel.

Analysts estimate that imports by China could reach five million tonnes by 2000. They, however, feel that the growth in India is constrained by the lack of infrastructure especially port capacity for imports.