Iran has struck new deposits of “unconventional” oil estimated to hold up to 5bn barrels altogether, the head of the exploration department of the National Iranian Oil Co. (NIOC) said in remarks carried by Shana News Agency on March 11.

At the current price of Brent crude of $69, that would estimate to a value of above $346bn on the international markets and is just the tip of the iceberg when it comes to Iran's massive undiscovered oil and gas fields and boost the country's output for several decades to come, according to some local experts. However, despite the natural bounty afforded to the country, with US sanctions placed on the Islamic Republic's oil and gas drilling and exports, finding international partners will be near impossible currently. 

Mohyeddin Jafari said the department was conducting further studies to assess the economic feasibility of extracting the newly discovered reserves.

Jafari did not specify the exact locations of the deposits but said they were in previously undiscovered areas of the country, as has been the case with other recent discoveries.

His reference to “unconventional oil” likely pointed to shale oil reserves, but when pushed on specifics, the official was unwilling to comment. 

Iran first came across shale oil reserves in early 2017 near Ghali Kooh Mountain in the western Lorestan province, a field estimated to contain up to 2bn barrels of light crude.

Last year, the NIOC’s exploration department announced that it had identified ten shale oil fields across the country and developed a “homegrown method” to make crude extraction from such reservoirs viable.

According to Petroleum Ministry officials, this technique has already been used to extract crude in a pilot test with an API gravity of 40 degrees from Lorestan’s shale oil reserves.

API gravity measures crude oil density, typically between 15 and 45 degrees. Higher values indicate lighter, lower-density crude. The American Petroleum Institute, the industry organisation that created the measurement system, established the index.

Crude oil with an API gravity of 40 degrees is relatively rare in Iran but is part of the country's growing mix of valuable minerals and hydrocarbons. More recently, in the push to broaden the country's ability to jump on the electric vehicle craze in China and the US, Iran revealed it was sitting on some of the largest lithium deposits in the world. 

This story is a Newsbase Middle East Oil and Gas (MEOG) syndication.