Iran's Oil Minister Bijan Zanganeh says Iran and Iraq have agreed to jointly develop two natural gas fields at their border areas.
Official news agency IRNA quoted Zanganeh on Sunday as saying "initial agreements have been made on developing the two natural gas fields in Naft Shahr and Khorramshahr."
He said Iraq is a developing country where several oil projects are being carried out and has "a good potential for extensive cooperation with Iran."
However, due to U.S. sanctions bilateral trade has suffered in recent months and Iran has been scrambling to find financial mechanisms to enable businesses transfer money between the two countries.
Iran and Iraq share 1629 kilometers of borders and have 12 joint oil fields including Naft Shahr, Naft Khaneh and Dehloran.
The border areas between the two countries are currently affected by floods.