Azerbaijan says it is nearing an agreement with Iran on the legal status of the Caspian Sea, a contentious issue since the collapse of the Soviet Union in 1991.

Azerbaijani Deputy Foreign Minister Khalaf Khalafov made the comment Wednesday after holding talks in the capital, Baku, with his Iranian counterpart, Mekhti Safari.

Mr. Khalafov is Azerbaijan's special envoy for the negotiations on the Caspian Sea.

Azerbaijani and Iranian officials have considered dividing the Caspian Sea, which is believed to contain large oil and gas reserves, into five equal parts. Until the collapse of the Soviet Union, the sea's status was regulated by treaties between the Soviet Union and Iran.