"While we wait for a solution (to the dispute), we agreed today that the navies of the two countries will try to find a solution to reduce tension in the area," said Najib.

"While there was no need to withdraw warships from the disputed waters, the two countries need not stage a show of forces, just normal presence will be alright," he was reported as saying.

The Indonesian VP told reporters during his visit to Malaysia that navy chiefs of both countries had discussed how they could conduct "friendly patrols" without causing a conflict.

Both the state oil companies of Malaysia and Indonesia (Petronasi and Pertamina respectively) have each offered oil exploration permits over the contested area - known as the Ambalat region offshore Borneo island, made up of the sultanate of Brunei, Malaysia's Sabah state, and Indonesia's Kalimantan province.

Malaysia is also in dispute with Brunei over contested marine exploration acreage but are said to be closer to a resolution than with Indonesia.