BHUBANESWAR, India, May 11 (Reuters) - Two Indian executives of South Korean steelmaker POSCO <005490.KS> were detained on Friday by villagers angry at plans for a $12 billion project on their farmland, police and officials said.

Hundreds of villagers confronted the officials when they went to Govindpur village to try to persuade farmers to sell their land in the eastern state of Orissa.

Police identified the detained as senior executive Debasis Swain and public relations officer Pranabananda Das. Another executive was released after a few hours.

"They were detained this evening," Y.K. Jethwa, police chief of Jagatsinghpur district where the village is located, told Reuters. "However, the protesters allowed the woman executive to go back. The other two have been detained."

Police hope for a peaceful settlement to the stand-off. POSCO spokesman Shashank Patnaik said negotiations were in progress.

Abhay Sahu, president of an anti-POSCO front, said: "We will ask them (the executives) to give an undertaking that they will not come here again."

The project -- India's single largest foreign investment -- has faced stiff opposition from some villagers who say thousands would be displaced. Other villagers support the project and clashes between the two groups injured 50 people in March.

Activists say the POSCO project could displace around 20,000 people and there are also environmental concerns.

The government says the plant would affect only 500 families and create thousands of jobs. Orissa's government says its rehabilitation package is among the best, offering cash and a job for at least one member of each family losing its land.

POSCO has also promised to help find plots for displaced landowners.

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