Iran has cut oil production by 200,000 barrels per day (bpd) from 4.04 million bpd, in line with an Opec agreement to find ways to support declining crude prices, a director of the state oil company said.

'We are obeying the Opec quota. We have cut by 200,000 bpd,' Mohammad Ali Emadi, director of National Iranian Oil Company (NIOC), said on Friday in Beijing, where he is attending a forum of national oil companies.

Asked about the excess crude from the cuts, Emadi said, 'Some will be sent to storage and sometimes we use this opportunity for overhaul and maintenance.'

He said Iran, the world's fourth-largest oil producer, was targeting 5m bpd of oil production capacity by the end of 2010, up from capacity of 4.2m bpd now.

'We have some major plans (to raise total output), including the upgrading of surface facilities for more water cut separation,' he said.

'We are also planning more gas injections and water flooding in offshore areas. On top of the brownfield projects we are also developing many greenfields.'

Iran's oil and gas sector is turning to energy-hungry Asia for funds, expertise and technology to elude US sanctions.

China's Sinopec Group signed a deal last December to develop Iran's huge Yadavaran oilfield, among the state-owned Asian energy giants desperate to lock in long-term future supplies.

'Output of these brown and greenfields will provide this figure (of 5m bpd),' he said.

Emadi said Iran was continuing to talk to potential buyers in the Middle East and South Asia for its gas: with Bahrain for one billion cubic feet per day (cfpd), the UAE for the same volume, Kuwait for 0.5bn cfpd, and India and Pakistan each for 60m cu metres per day.

'For these new agreements, some we are finalising the points, some we are in the discussion stage,' he added.-Reuters