The State-owned China National Offshore Oil Corporation (CNOOC) is in talks with British Petroleum Corporation (BP) to buy 60 percent of its shares in South America, as the British oil giant trys to raise money to pay for its huge Gulf of Mexico oil spill, according to The Guardian.

BP is looking to sell 60 percent stake of Pan American Energy, an Argentine oil producer.

The UK's Sky TV said BP is confident the deal with CNOOC will be concluded "within weeks", but the deal still needs approval from the Argentine government, which has long history of rejecting foreign companies from drilling domestic resources.

CNOOC already owns 20 percent of Pan American through its stake in Bridas Corp, which the company acquired several months ago.

BP and CNOOC, China's third-largest oil and gas company following CNPC and Sinopec, declined to comment on the talks Wednesday.

BP said it has spent $3.12 billion so far in attempts to stop an oil leak in the Gulf of Mexico and to settle damage claims, and the company has been under intense pressure from the White House and other governments.

The April 20 blowout on the Deepwater Horizon rig in the Gulf of Mexico killed 11 workers and is the worst oil spill in US history.

According to the Sky TV, other BP assets in Latin America, particularly in Colombia and Venezuela, may be sold too.

The British oil giant has also been working on other plans to compensate its huge financial losses, including an additional $5 billion round of bank facilities, The Financial Times reported.

The Chinese government has been encouraging State-owned companies to make overseas mergers and acquisitions.

Over the past 12 months, Chinese State-owned energy companies have spent at least $20 billion buying oil and gas assets overseas to meet surging demand in the world's fastest growing major economy. The oil giant also aims at expanding its sales in overseas markets.