Istanbul - Turkey and Iran are to move forward with negotiations on a major agreement on the transport of natural gas, following Iranian president Mahmoud Ahmadinejad's visit to Istanbul last week.

Turkey and Iran had signed a memorandum of understanding in 2007 that would see the transport of natural gas from Iran via Turkey to Europe. According to officials however, disputes over the terms and conditions of the deal had impeded progress thus far.

Ahmadinejad said in Istanbul on Friday that "I hope that we are very close ... Turkey is the key country for the transport of Iranian gas to Europe."

The US, which remains in a stand-off with Iran over its nuclear activities, has opposed the deal. Turkey, a NATO member, could in theory face US sanctions if it goes ahead with the project.

However, Turkish Energy Minister Hilmi Guler defended the deal. "We are an independent country, and this is in the interest of our country," he told Turkish television on Tuesday. The minister is hoping to finalize the agreement within a month.

Guler and Turkish Foreign Minister Ali Babacan are due to travel to Tehran for further talks in two weeks. (dpa)