The semi-official Mehr news agency quoted the governor of the Khorasan-e Razavi, Mahmoud Salahi, as saying that the gas field, named Kapeh Dagh, is located close to the Turkmenistan borderline.

"With the gas field's discovery, Khorasan-e Razavi will become the country's second gas hub," he said.

Currently the country's biggest gas production centre is in the south, based around the South Pars gas field in the Gulf.

Salahi added that projected production capacity at the new gas field would be more than 120 million cubic metres a day.

Iran is the world's fourth-largest oil producer and boasts to possess the world's second-largest natural gas reserves after Russia, but US and UN sanctions deterring investment by Western firms with expertise and technology have slowed its development as a major exporter.