Malaysia, RI agree on oil, gas deal

Malaysia, RI agree on oil, gas deal

LANGKAWI, Malaysia (Reuters): Malaysia and Indonesia agreed on Tuesday to step up cooperation in oil and gas production following this month's landmark agreement between the two neighboring oil producers.

Malaysian Prime Minister Mahathir Mohamad said after talks with visiting Indonesian President Abdurrahman Wahid that both countries would also cooperate in refining their crude oil.

"We also agreed to continue with our cooperation in the field of oil and gas exploration and production and also in refining of oil in our two countries," he told a news conference in the northern Malaysian island of Langkawi.

Mahathir gave no details on the possible new tie-ups. Indonesia is Asia's only OPEC member while Malaysia is a major non-OPEC oil producer.

Wahid is in Langkawi for a two-day visit before heading for South Korea on Wednesday for an Asia-Europe meeting.

Indonesia's Energy and Mines Minister Purnomo Yusgiantoro and head of Malaysia's state oil firm Petronas, Hassan Marican, attended the Langkawi talks.

Petronas and Indonesian state oil company Pertamina earlier this month their first oil refining and gas sale deals.

Under one deal, Petronas will process 20,000 barrels per day of sour crude for Pertamina. Petronas will also buy natural gas for 20 years from Indonesia's West Natuna Sea area from Pertamina.