CATALIST-listed OEL Holdings has entered into a non-binding memorandum of understanding (MOU) to buy a stake in a company indirectly involved with China oil giant PetroChina in developing two oilfields in China's Jilin province.

OEL will buy a 60 to 100 per cent stake in Hong Kong firm Allied Resources amounting to between S$22.5 million and S$37.5 million. Shares in OEL could be issued at 9.5 Singapore cents each to the seller or his nominee.

Currently incurring losses, OEL gets income from property rental and ship repair.