NATIONALIST MSPs have called for the campaign against Scottish independence to return a £500,000 donation from the chief executive of controversial oil traders Vitol.

Deputy First Minister Nicola Sturgeon told Holyrood it would be a wise course of action for Better Together to return the money to Ian Taylor pending an inquiry into the decision to accept the donation.

Cathcart SNP MSP James Dornan raised the general issue of discussions between the Government and the Electoral Commission regarding campaign funding and donations in relation to the referendum.

Turning to the issue of Mr Taylor's donation to Better Together, he said: "The minister will be aware of the public concern about this donation and may have seen the petition by the National Collective about it, which I have signed and would urge others to do.

"Does the Cabinet Secretary agree with me that Scotland's referendum must be conducted to the highest possible standards and that therefore the No campaign should hand Mr Taylor's half million pounds back pending a full internal investigation of this dodgy donation?"

The Deputy First Minister replied: "I am of course aware of the concerns that have been raised in the last couple of weeks and the seriousness of the questions that have been asked.

"I am also very aware there are those in the Labour Party who previously criticised donations from the same source when these were made to the Conservative Party."

She added: "It's obviously not for me to run the No campaign but I do agree that it may well be a wise course of action for them to hand back the money pending an internal investigation of the type suggested by the member.

"I am also aware that a petition is being pursued, although that is of course a matter for the Public Petitions Committee.

"For our part, we are absolutely determined that this referendum will be run to the highest standards of probity."

A spokesman for Better Together said: "It would probably be a better use of the Nationalists' time if they tried to figure out how they get out of their currency chaos rather than continually attempting to smear someone who has made a significant contribution to Scotland."

The National Collective is a pro-independence group drawn from the artistic and creative sectors.

It was the first to highlight past controversies about Vitol's dealings in Serbia and Libya and Mr Taylor's donations to the Conservative Party.

It is now collecting signatures for a petition calling for the Scottish Parliament to examine the background to the donation, claiming: "There cannot be a fair referendum if money is solicited from outwith Scotland or from rich Tory donors who do not vote in Scotland."

Earlier this week at Westminster, the SNP's Angus Robertson raised the issue of Vitol paying a Serbian warlord a million dollars in connection with an oil deal. Another controversial deal had also been struck in that region.

In late 2003 the Swiss-based company struck an oil deal with the Bosnian Serb government.

It was signed by Economy Minister Milan Bogicevic, who was also on the board of state oil company SDS.

Just over six months later the UN High Representative Paddy Ashdown stripped him of all offices, accusing him of harbouring indicted war criminals over a 10-year period.

The company insisted: "Vitol dealt with Milan Bogicevic in his capacity as Minister of Economy, Energy and Development in the legitimate government of the time and in relation to a state owned refinery. Vitol had no way of anticipating the subsequent decision of the Office of the High Representative taken in July 2004."