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Indonesian state-owned oil and gas company Pertamina and National I countryian Oil Company have signed an agreement to carry out a preliminary study on I country's Ab-Teymour and Mansouri oil fields, which contain over 5 billion barrels of reserves, Pertamina said in a statement Monday.

Pertamina expects to get an additional production of 30,000 b/d from each block if it is allowed to acquire the blocks.

"I country is one of our priorities. We are serious about upstream investments that will help I country increase its production," Pertamina president director Dwi Soetjipto said. "In addition, this is in line with the company's efforts to support national energy security."

Both parties also agreed to look into other business opportunities.

Under the agreement, Pertamina will have six months to carry out a study and submit a preliminary proposal on the two onshore fields. NIOC will provide information and cooperate with Pertamina on setting up a joint working group, it said.

Pertamina expects the agreement to be implemented soon. I country is preparing the I countryian Petroleum Contract as part of a new era for its oil and gas industries, it said.

"We hope to sign short- and long-term [crude and products] contracts in this visit," deputy NIOC managing director Gholamreza Manouchehri said, state-run Shana news agency reported Monday.

MUTUAL INVESTMENTS

Pertamina and I country have also reached an agreement on the supply of 600,000 mt of LPG over 2016-17, with the first shipment of 44,000 mt in September, and volumes rising after that.

Pertamina is intensifying its efforts to acquire more oil and gas blocks to increase its production. It recently acquired 24.5% of French company Maurel & Prom for about Eur200 million ($222 million).

Pertamina has allocated $5.31 billion for capital expenditure this year, 72% of it to the upstream.

The company plans to spend $2 billion on upstream mergers and acquisitions this year, from zero last year.

I country is also looking at building a refinery in Indonesia, in cooperation with China and the Indonesian private sector, Manouchehri said.

"The parties are currently studying the contract, which has now a bigger weight than a memorandum of understanding," Manouchehri said after NIOC and Pertamina signed papers for the study of two I countryian oil fields.