HONG KONG, Mar 14 (AP) -- U.S. casino operator Las Vegas Sands will team up with Hong Kong's Regal Hotels International on a hotel-casino project in the booming southern Chinese gambling enclave of Macau, the Hong Kong company said Monday.

The first phase of the project in Macau's Cotai area will offer at least 1,500 rooms, a casino and a showroom for large performances, Regal Hotels said in a statement posted on the Web site of Hong Kong's stock exchange.

The statement said Regal Hotels International Ltd. will build the complex and Las Vegas Sands Inc. will lease and run the casino and showroom.

It said construction of the hotel-casino's initial phase is scheduled for completion by late 2007. The hotel and casino portions of the project will be expanded later, it said.

Las Vegas Sands is among the new casino players in Macau since 2002 when the local government ended a four-decade monopoly held by tycoon Stanley Ho.

The U.S. company opened the Sands Macau casino in May and hopes to develop Cotai into Macau's version of the Las Vegas Strip.

The company already is building the Macau Venetian Casino Resort in the area and said late last year it wanted to build more hotel-casinos with partners, with the partners financing and running the hotels and Las Vegas Sands operating the casino portions.

The Standard newspaper on Monday quoted Regal Hotels Executive Director Donald Fan as saying the company will invest up to 2 billion Hong Kong dollars (US$260 million; €191 million) in the latest project.

Regal Hotels runs five hotels in Hong Kong, including Regal Airport Hotel, and two in Shanghai.

Former Portuguese colony Macau, which returned to Chinese rule in 1999, is 60 kilometers (40 miles) west of Hong Kong.