The project requires construction of two undersea pipelines totaling 450 kilometers (279-miles) in length between Riau and Singapore, the report said, adding that it could be operational in about five years.

The project involves Indonesia-listed Upton Synergy Indonesia, the Riau government-owned Riau State Holdings, and possibly Singapore and international partners, it added.

"No agreements have been signed yet," Irwanto Oentung, head of the international division of Riau State Holdings was quoted as saying.

The governments of Singapore and Indonesia entered into an agreement in 1991, good for 100 years, to develop water resources in Indonesia for supply to Singapore, said a Public Utilities Board spokesman.

Singapore now buys a large portion of its water needs from Malaysia under a contract which expires in 2061.