AS REPORTED in April, Jaguar has been hard at work on a hybrid version of its new XJ flagship.

Today, Jaguar confirmed that development of its petrol-electric hybrid XJ - dubbed Limo Green - is nearing completion, with a test vehicle now making its way around the UK.

Similar to the Chevrolet Volt, the Jaguar XJ Limo Green is motivated primarily by an electric motor, generating 145kW and 400Nm of torque, drawing power from a lithium-ion battery.

As with the Volt and unlike purely electric vehicles such as the Nissan LEAF, the Limo Green’s electric motor is paired with a 1.2 litre petrol engine developed by Lotus and designed to extend the electric motor’s range.

When the electric motor’s battery charge is depleted, the petrol engine will activate, charging the lithium ion batteries. With this electric-petrol combination, the Limo Green offers a range of up to 965km - powered largely by electricity.

“The technology is still in its infancy and there is still a lot of work to do before we can even think of production,” Anthony Harper, Research Head at Jaguar Land Rover said.

“The components aren’t at the right cost or quality yet that you would expect of a Jaguar product, but the technology is there.”

Developed in partnership with Lotus, Caparo and the British Government, the project has cost some £800 million (AU$1.5 billion), leading to the Limo Green and the in-progress Range Rover LRX.

With the British government’s sizeable investment in the project, some are speculating that the current fleet of Jaguars serving UK ministers will be replaced by the Limo Green models when they enter production (expected in the next three years).

GALLERY » 2010 Jaguar XJ - Official Images