An Iranian diplomat says Tehran and Ankara have agreed on the details of a deal to produce natural gas in Iran and export it to Turkey.

Ahmad Noorani, head of economic affairs at the Iranian embassy in Turkey, told Reuters on Tuesday that the two countries had worked out a number of issues, including pricing, and added that part of the deal may be finalized during President Mahmoud Ahmadinejad's visit to Turkey.

The Iranian President is expected to pay an official visit to Turkey in late August upon the invitation of his Turkish counterpart Abdullah Gul.

Iran announced in July that the construction of a 600-million-euro pipeline to transfer the country's natural gas to Turkey and Europe would begin soon.

Iran's Pars Oil and Gas Company and the Turkish Petroleum Cooperation (TPAO) signed a memorandum of understanding last year, allowing TPAO to pump 20 billion cubic meters of natural gas from Iran's South Pars gas field.

The two countries are also holding negotiations to finalize an agreement on the development of three phases of South Pars.

Iran possesses the world's second-largest gas reserves after Russia. Turkey has been a consumer of Iranian gas since 2001.

AKM/HGH