The Celtic Manor is bidding for the EU foreign ministers' meeting

Foreign Secretary Jack Straw is due to host the informal two-day summit once the UK takes over the presidency of the EU for six months in July 2005.

The BBC Wales News website understands that electronics billionaire Sir Terry Matthews' Celtic Manor Resort at Newport, is close to signing the deal.

The venue has already landed the 2010 Ryder Cup golf tournament.

It is understood final negotiations are being made to see where the summit will be hosted in the UK - at least two major London venues are also said to be competing.

We are finalising arrangements for the informal foreign ministers meeting next September and an announcement will be made in due course Foreign Office

But the Celtic Manor - a major hotel and conference centre - is understood to be the favourite for the deal.

It would see the venue hired exclusively for the VIP guests - and a small army of security staff and visiting journalists.

It is not the first time the Newport-based site has landed a high-profile event.

In 2001, it beat off bids from five Scottish venues and one in northern England to land the 2010 Ryder Cup golfing event.

The hotel's golf course will remain open to club members while the informal EU summit is underway - but no members of the public will be allowed to stay at the hotel.

Announcement due

It is understood Gwent Police are already planning security for the event.

The last such meeting was held in Ireland in April and the one before that was in Holland.

The Foreign Office is organising the UK event in September 2005.

Wales last played host to a European level meeting in June 1998 - during the last British presidency - when EU leaders held a two-day summit in Cardiff.

A Foreign Office spokesman said: "We are finalising arrangements for the informal foreign ministers' meeting next September and an announcement will be made in due course."

A spokeswoman for Gwent Police said: "We cannot confirm a Foreign Office meeting at the Celtic Manor next year as there has been no formal announcement from the government that it is taking place there.

"We will provide details when an official announcement is made."

The Celtic Manor declined to comment at this stage.