British newspaper the Sunday Times reported that BHP Billiton the world's top mining company wants to buy Royal Dutch Shell's stake in Woodside Petroleum ahead of launching a full takeover for the Australian oil and gas producer.

The paper said that BHP is in talks with Shell, which holds a 24% stake in Woodside, about taking its shares in return for some of BHP's assets, including the Sunrise gas field.

Talk of a BHP bid picked up steam last November when Shell sold a third of its stake in Woodside and said it would be willing to sell the remaining 24%. BHP has plenty of cash to put to work after enjoying a boom in commodity prices.

Price concerns have seen shareholders and analysts pour cold water on the bid, while another clue that a deal is not close is that BHP has not suspended its off-market share buyback, with the tender for shares due to close on April 8.

The takeover rumour gained currency because Woodside is seen as an obvious target for BHP.

(Sourced from Reuters)