BAGHDAD -- Iraq's prime minister said on Thursday that his country and neighbouring Turkey have agreed on closer security and intelligence co-operation in the face of the threat posed by the Islamic State group.

"We have a key agreement to exchange information and have full security co-operation," Prime Minister Haider al-Abadi told a news conference after talks with his visiting Turkish counterpart, Ahmet Davutoglu. "The Turkish prime minister also wants us to have military co-operation in the face of terrorism and Daesh and we welcome that," said al-Abadi, using the Arabic acronym for the Islamic State group.

Davutoglu confirmed the two sides' agreement on closer security co-operation.

"I can say that Daesh threatens both Iraq and Turkey, but we will co-operate and do everything we can to stand up to terrorism," he said. "There is a new page in relations between Turkey and Iraq and that is why I hope that there will be close co-operation between our security and intelligence agencies to defeat terrorism."

The Turkish prime minister also rejected charges that his country facilitated the transit of militants through its territory to Syria.

"Turkey receives 35 million tourists a year and we cannot stop people from entering unless we have a case against them," he said in reply to a question. "There is no evidence or proof any Daesh leader transited through Turkey and if anyone has one he should come forward."

About a third of Iraq, which shares a porous border with Turkey, is held by the Islamic State group. Earlier this year, the group declared a caliphate on the large swaths of territory under its control in both Iraq and Syria.

Relations recently soured between Turkey and Iraq over what Baghdad sees as illegal oil exports through Turkey by its Kurdish self-ruled northern region. Al-Abadi said on Thursday the two countries have reached an agreement on the issue but did not elaborate.

He said Davutoglu has made clear to him that Turkey was keen to have "transparent and clear" relations on the oil issue and that Baghdad would be informed of any Iraqi oil exports going through Turkish territory.

Baghdad moved to withhold the 17-per cent share of the national budget normally earmarked for the Kurdish region -- an estimated $20 billion -- after the Kurds independently shipped oil to Turkey in January. In May, the Kurdish government sold 1.05 million barrels -- worth more than $100 million at the time -- in Turkey.

Negotiations between Baghdad and the semi-autonomous Kurdish Regional Government yielded some progress last week after Baghdad agreed to release $500 million in frozen budget payments. In return, the Kurds will provide 150,000 barrels of oil per day for Baghdad to sell.

In Paris, the prosecutor's office said investigators on Thursday formally opened a terrorism investigation into three French Islamic State recruits calling for attacks back home in a propaganda video.

The three men, who appear under Arabic pseudonyms, appear in a montage that also shows multiple French passports being burned in a campfire. They call on fellow French citizens to join them or carry out attacks in France.

Agnes Thibault-Lecuivre, spokeswoman for the Paris prosecutor's office, said the anti-terrorism investigation would seek to identify the men. A former French fighter linked to the Islamic State group is accused in a deadly shooting at a Brussels Jewish museum, and European officials fear that newly radicalized and trained militant recruits will return from the battlefields of Syria and Iraq to cause havoc at home.

In the embattled northern Syrian town of Kobani along the Turkish border, the U.S.-led coalition carried out at least four airstrikes against Islamic State positions on Thursday, the Britain-based Syrian Observatory for Human Rights said.

Islamic State militants launched their offensive against Kobani in mid-September. After an initial rapid advance, the campaign has slowed to a grind as they faced stout resistance from the town's Kurdish defenders backed by international airstrikes.

Amnesty International has meanwhile called on the Turkish government to ensure safe passage for Syrian refugees seeking a safe haven in Turkey. In a new report, the London-based human rights watchdog said it has recorded at least 17 refugee deaths by border guards who used live ammunition at unofficial crossings between December 2013 and August this year.

Turkey is currently home to at least 1.6 million refugees from Syria, of which over 220,000 are accommodated in government-run refugee camps, Amnesty said. While Turkey maintains an open-border policy for Syrian refugees at official crossings, there are only two fully open crossing points along a 900-kilometre stretch of the border.