The third-biggest US oil firm is believed to be in negotiations with Lukoil, in which it owns an 18% stake, to sell its holdings in two Czech refineries.

A sale could net ConocoPhillips between $200m and $230m, according to one Russian analyst.

ConocoPhillips is also believed to be discussing the possible sale of its other European refineries . . . including Whitegate . . . to Lukoil, which produces 1.8 million barrels of crude oil a day.

ConocoPhillips' shares in the two Czech refineries are held through a 16.33% stake in Ceska Rafinerska. The US company's share of the combined refinery capacity is 27,000 barrels of oil a day.

Whitegate, which is a socalled hydroskimming facility, can process 71,000 barrels of oil a day.

One industry expert said that Whitegate has the ability to refine oil with a high sulphur content, such as that which Lukoil sources in the former Soviet republics. As such, it could be an attractive proposition for the Russian company. Hydroskimming plants produce diesel and also fuel-oil which is further processed by refineries known as 'crackers', into petrol.

Margins generated from hydroskimming plants can be low, or even negative, but the facilities can command generous prices as oil companies can make attractive returns on further refining the product they generate.

Lukoil, which has a market capitalisation of over $65bn, has stated its intention to acquire refinery capacity around the world.

Earlier this year it tabled a bid for BP's refinery at Coryton in England, which can process 172,000 barrels of oil a day.

However, while the Whitegate refinery could be acquired by Lukoil, the company may be more interested in infrastructure that is directly linked to Russian crude oil pipelines.

In August, Lukoil also said it was bidding for a refinery in Rotterdam that has an 85,000 barrel-of-oil-a-day capacity.

ConocoPhillips, which is valued at close to $100bn, acquired the Whitegate refinery in 2001. It was part of the state-owned Irish National Petroleum Corporation (INPC) and was sold to oil company Tosco in 2001 for $100m.

Tosco was later acquired by Phillips, which then merged with Conoco. The refinery, which employs roughly 150 people, is seen as non-core to ConocoPhillips by analysts.