Iran has discovered major reserves of shale oil in the western parts of the country with a top official saying that the reserves are the first that have a feasible potential for production.

"Based on studies, it is estimated that the shale oil reserves in Ghali Koh in Lorestan amount to 2 billion barrels of oil in place," Bahman Soleimani, NIOCs deputy director for exploration. "The oil is light", he added.

Soleimani said exploration was also being carried out for shale gas reserves in the area, and the studies were expected to be completed by October, 2017.

Irans proven oil reserves of about 160 billion barrels, almost 10 percent of the worlds total, rank it fourth among petroleum-rich countries.