Saudi Arabia wants to buy five German submarines for around 2.5 billion euros ($3.4 billion) and more than two dozen more in the future, a newspaper reported Sunday.

Citing unidentified government sources, Sunday's Bild newspaper said Riyadh had its eye initially on buying the five Type 209 submarines, followed long-term by up to 25 submarines in a 12-billion-euro deal.

It said the chancellery had, in a letter to Saudi Arabia in the summer, indicated a swift and sympathetic examination of Riyadh's weapons plans as soon as the new German government was established following September elections.

German Chancellor Angela Merkel's conservatives are currently locked in negotiations with the centre-left Social Democrats on forming a grand coalition.

A German government spokeswoman, contacted by AFP, declined to comment and would not confirm or deny the reported letter.

In Riyadh, officials do not usually publicly comment on such deals.

Germany's heavy industry giant ThyssenKrupp which, the paper said, would produce the submarines was quoted by Bild as saying there was "no project on submarines for Saudi Arabia".

German arms sales to Saudi Arabia have in the past been criticised by opposition politicians, especially in light of pro-democracy uprisings throughout the Middle East.

For decades Germany declined to sell heavy weapons to Saudi Arabia because of concerns over human rights and fears for Israel's security.