TEHRAN Iran's Oil Ministry has issued permit for the construction of a refinery in northern Ardebil Province, following exploration and extraction of crude from an oil field in Moghan region, near the border with Azerbaijan, the Persian daily ***** Aftab-e Yazd ***** said on Saturday.

The paper cited a member of the Energy Commission of the Parliament, Hassan Almassi as saying that the refinery would be built with the foreign investment.

He said several foreign oil companies, including Royal Dutch/Shell as well as BP Amoco had shown interest in the exploration of the Moghan oil field.

The Iranian Oil Ministry, he said, had to partner with foreign investors for the development, seismological operations as well geochemical studies of the oil fields.

This is the second exploration attempt of the Islamic Republic near the Caspian Sea after the country announced in March it would not wait for the legal regime of the sea to be determined.

Iran's Sadra marine structures company in March signed a 226-million-dollar oil exploration contract in the Caspian Sea with Sweden's GVA consultants.

The project, which will take 32 months to be completed, involves building an oil rig on a submersible platform in northern Neka. It is said to create 2,000 job opportunities.

Iran, Russia, Kazakhstan, Turkmenistan and Azerbaijan are the five countries bordering the Caspian Sea.

The Islamic Republic has repeatedly indicated that it will agree to an equitable sharing of the oil-rich Caspian Sea which would give it a 20 percent share.

The Caspian Sea is estimated to contain the world's third largest reserves of oil and gas after the Persian Gulf and Siberia.