Indonesia's Merpati Nusantara Airlines plans to acquire as many as 40 Commercial Aircraft Corp of China (Comac) ARJ21 regional jets in the next two years.
The airline has signed a memorandum of understanding with AVIC International at the Singapore Airshow for the order, said sources familiar with the situation.
AVIC International markets Chinese-made aircraft to foreign governments and airlines.
Merpati is likely to firm up the order in the next two years and will likely operate the aircraft domestically, said a Merpati official.
Comac was supposed to deliver the first ARJ21 to Chengdu Airlines in late 2011 but issues with the aircraft's testing programme have delayed the first delivery. It is not clear when Comac will be able to deliver the aircraft.
If the purchase is firmed up, the ARJ21 will not be Merpati's first Chinese aircraft. The Indonesian airline already operates a fleet of Xian Aircraft MA60 turboprops, one of which was involved in a crash in May 2011 that killed all 25 people on board.