Myanmar started the exploration early this month, despite protests by Bangladesh, in a stretch of sea both countries claim.
Bangladesh deployed naval ships to the area, reinforced troops along the 320 km (200 mile) border it shares with Myanmar, and sent a high-powered diplomatic team to Yangon to discuss the issue.
The team, headed by Foreign Secretary Touhid Hossain, returned to Dhaka on Sunday, and said Myanmar had stopped exploration in the disputed waters and removed equipment.
"Myanmar has completely withdrawn equipment and ships from our water territory," Touhid told reporters.
Foreign Affairs Adviser (minister) to Bangladesh's interim government, Iftekhar Ahmed Chowdhury, earlier said a Korean company Myanmar had engaged to explore oil and gas for it had suspended its work and started withdrawing.
However, Myanmar's official media presented this as a technical move and said the South Korean company undertaking the exploration work had simply moved to another block after a successful seismic survey.
Security officials said Myanmar also built up army troops at strategic points on its side of the 320 km (200 miles) border, partly demarcated by the Naf river and shared by the two countries.
Both countries have also reinforced paramilitary border guards, officials and local villagers said.
Major-General Shakil Ahmed, chief of the Bangladesh Rifles border force (BDR) visited his troops at areas bordering Myanmar on Monday.
He asked his soldiers to keep on high alert but hoped the situation would not escalate into a military confrontation.
The BDR earlier advised people in border villages to leave their homes if the situation warranted.
Besides paramilitary guards, both sides have moved in army units, but deployed them five km (three miles) away from the border lines, to abide by international military convention.
The dispute would be a focal point of discussion when technical delegations from both sides meet in Dhaka on Nov. 16 and 17 to talk demarcation of their maritime boundary, officials said.
The two countries have been discussing this for years but without reaching an agreement. (Additional reporting by by Mohammad Nurul Islam in COX'S BAZAR; Editing by Anis Ahmed and Jerry Norton)
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