Jafari said drilling of the field’s third well will soon begin to determine the boundaries of the oil, gas and water zones and to finalize the reservoir’s estimated capacity.

Speaking Monday during a media visit to the site of Pazan’s second exploration well, Jafari noted that it was the first time journalists had visited an exploration well in person. The Pazan field is located near the village of Semengan, along the Zagros Mountains, whose northwest-southeast geological structure has enabled recent discoveries.

He said the first Pazan well was drilled in 2015 to a depth of 3,800 meters, leading to an initial discovery before operations were halted due to technical issues. The site was later revisited, and drilling of the second well extended to around 4,600 meters.

 New oil, gas layers discovered

According to Jafari, two new hydrocarbon-bearing layers were discovered in the second well. The upper Dalan formation contained oil with an estimated 200 million barrels of oil in place, while the deeper Farragun formation—one of Iran’s oldest geological strata—yielded a new gas layer.

“Testing began in March 2025, and petrophysical data confirm the field’s strong production potential,” he said. “The third well, to be drilled soon, will help define reservoir boundaries and finalize reserve estimates.”

With the latest findings, about 10 trillion cubic feet (TCF) of gas have been added to Iran’s reserves, making Pazan the country’s largest onshore gas field—surpassing Tabnak, Kangan, Homa, Varavi, Shanul and Shahini fields, Jafari said.

He thanked the NIOC managing director and the oil minister for supporting the company’s efforts in geological studies, seismic surveys, drilling and reservoir engineering that led to this major discovery.

 $100b economic value

Each onshore exploration well costs between $15 million and $20 million to drill, Jafari said, noting that offshore wells can cost several times more. Based on current global gas prices—around 30 cents per cubic meter—he estimated Pazan’s economic value at more than $100 billion, though that figure varies depending on domestic and export pricing.

Exploration risks, he added, are inherently higher than production risks due to geological uncertainties and operational challenges.

 Exploration underway in 26 provinces

Jafari said exploration operations are currently underway in 26 provinces, including promising regions such as the Zagros belt, North and South Dezful, Lorestan, Fars, Ardabil, North Khorasan, South Khorasan, Razavi Khorasan, Kermanshah, Ilam, Bushehr and areas along the border with Azerbaijan.

He also announced that NIOC has launched its first marine seismic tender in 25 years. The last such operation was conducted in 2000. The new survey will cover roughly 10% of the Pars-Abadana area in the Persian Gulf, he said.

According to Jafari, increasing the number of active drilling rigs is one of the most effective ways to accelerate discoveries. “If we raise the number of rigs from six to 10, the pace of discoveries could double,” he said. Between the second and sixth development plans, the average number of exploration rigs was about six, though only five were operational on average.

 Oil exploration in Ardabil

Jafari said despite challenges, NIOC continues its efforts to expand Iran’s hydrocarbon resources. In Ardabil Province, 2D and 3D seismic operations are underway. The presence of natural oil seeps and active production in neighboring Azerbaijan make the area promising for new discoveries, he said.

He also highlighted NIOC’s digital transformation efforts, noting that the company has developed its first artificial intelligence roadmap and signed an implementation contract in May. “AI is now being applied to seismic and petrophysical data processing and drilling fluid design, which has greatly improved the precision and speed of operations,” Jafari said.