Chad Monday announced it was reopening a major oil refinery it had earlier ordered shut because of a price dispute with its Chinese part-owners.

"To help negotiations which are to continue, we have decided to reopen the refinery," Justice Minister Abdoulaye Sabre Fadoul said on public radio.

The Djarmaya refinery, ordered closed on January 19, is located 40 kilometres (25 miles) north of the Chadian capital Ndjamena.

It was inaugurated in June by President Idriss Deby Itno who described it as a "gift from China" that would offer energy independence to his land-locked central African nation.

It is 60 percent owned by the state-owned China National Petroleum Corporation International (CNPCI).

"We reopened negotiations three days ago, negotiations that have allowed for some progress on preliminary conditions put to our Chinese friends prior to reopening" the plant, the minister, in charge of the talks, said.

The government had asked the Chinese to ensure both regular exports of refined oil and affordable pricing for the local population, the minister added.

Disagreements over pricing was at the root of the dispute, a government source had earlier said.

The Chadian state holds the other 40 percent share in the refinery, which cost $60 million to build.

The refinery was designed to produce 20,000 barrels a day and is supplied from oil wells in the southern Bongor region through as a 311-kilometre (193 mile) pipeline.

Chad, which only began to produce oil in 2003, currently extracts about 120,000 barrels per day, according to Infrastructures Minister Adoum Younoussmi.