INTERVIEW-UPDATE 1-Innospec aims for sub-$300 mln acquisition by March end

* Looking for small oilfield specialty companies

* Also looking at personal care companies

* May partner Blackstone for a deal later in 2013

(Adds details)

Jan 8 (Reuters) - Fuel additives maker Innospec Inc is looking to buy an oilfield specialty company for less than $300 million by the end of the first quarter, its top executive said, a month after pulling out of the race to buy chemical company TPC Group Inc.

"We are combing all regions to look at small companies that are under $300 million, some public but mostly privately owned," Chief Executive Patrick Williams told Reuters in an interview.

Innospec's oilfield specialties business makes additive technologies for well and pipeline operations and helps companies remove hazardous by-products of crude oil and gas operations.

The company said on Monday it bought privately owned Strata Control Services Inc, a supplier of mud and fluid loss solutions to oil and gas drilling operations, in December.

Williams said the oilfield specialties business is likely to grow into a separate division by the time of the proposed acquisition in the first quarter.

The Colorado-based company, which claims to be the world's only producer of fuel additive tetra ethyl lead (TEL), also manufactures products used in personal care and fragrance industries and other specialty chemicals.

Innospec is preparing to cease all sales of TEL for gasoline this year. TEL, whose use as an automotive additive has been phased out from industrialized countries because of health and environmental concerns, accounted for about 5 percent of the company's total sales for the quarter ended September.

Innospec admitted in 2010 that it had bribed officials in Iraq and Indonesia with millions of dollars to continue using TEL, and in 2012, the then CEO pleaded guilty to corruption charges.

"We are looking at making acquisitions in the oilfield specialty and personal care space and balancing that out with potential buybacks and dividends," said Williams, who has held the top job at the company since April 2009.

It withdrew its $745 million offer for TPC in December, paving the way for the take over of the chemicals maker by First Reserve Corp and SK Capital Partners.

Shares of Innospec, which was spun off from Chemtura Corp in 1998, have risen about 13 percent since it dropped the bid.

Expansion in Russia, Brazil and the Asia-Pacific region will help the company offset weakness in Europe, the destination for nearly half of total sales, Williams said.

"It's not necessarily because TEL is going away that we are going to run out and acquire something," he said.

Williams said Innospec may again partner with private equity firm Blackstone Group LP for a deal in the latter part of 2013. Blackstone had agreed to bankroll the equity portion of the abandoned TPC deal.

(Reporting by Swetha Gopinath and Sriraj Kalluvila in Bangalore; Editing by Sreejiraj Eluvangal)