China and Japan have agreed to jointly develop natural gas fields in the disputed East China Sea, ending a long-running dispute as Beijing seeks to defuse tensions with Japan.

Under the deal, Japanese companies may invest in a Chinese projects tapping an undersea natural gas deposit, while the two countries will explore new and as yet undeveloped gas bloc and possible other joint ventures.

China is warming up to its Japan as part of a broader push to improve ties amidst growing wariness among some of its neighbours about its influence.

Chinese leaders want a stable international environment, as discord could disrupt China's rapid economic growth.

Japan and China, also Asia's two biggest energy consumers, are eager to develop new sources of energy.

The agreement will allow Japanese companies to invest in and claim profits from operations at a natural gas field where China is already drilling, known as the Chunxiao field in Chinese.

The two sides have also agreed to come up with an additional area for joint exploration.

The agreement, however, fell short of settling differences over territorial claims or deciding exploration rights for other gas fields in the area.