State oil company Petronas will retain its presence in Chad after resolving a tax dispute with the Chadian government which saw it expelled from the country.

"All parties were happy that the issue had been resolved," Petronas president and chief executive officer Hassan Marican told the Bernama news agency.

The Chadian government announced Friday that Petronas and US oil firm Chevron had reached an accord under which both companies will pay back taxes on their profits for 2005 and 2006.

It said the companies had agreed to pay an overall amount of US$281.6 million in taxes under the deal.

However, Hassan told Bernama the amount to be paid would be "much, much less" than that figure but would not divulge details.

Petronas and Chevron Texaco are part of a consortium working alongside ExxonMobil to extract the African country's oil.

In August, Chad told both companies their activities were being "suspended", and asked their representatives to leave the country and close their offices there because they had not paid tax on their profits.

Petronas is expected to resume its activities in Chad soon, Bernama said.