The discovery on Minoo Island is the first-ever oil find in this part of Abadan which is home to Iran’s largest and oldest oil processing facility.
“Yesterday at 10 o'clock in the morning, a well being drilled on Minoo Island reached oil. This is the first time we discover oil in the Abadan area,” Zanganeh told reporters after a cabinet session, Press TV reported.
“We have a lot of hope to discover (more) oil in the Abadan area and this grade discovered at a depth of 3,770 meters has an API gravity of 40 which is very light and sweet,” he added.
Zanganeh said drilling will continue to estimate the total volume of the reservoir and the possibility of production.
Iran also needs to determine whether it is an independent resource or an extension of an Iraqi oilfield currently producing on the other side of the border.
Last month, a senior official said Iran was scouring 60 percent of its total area for new oil and gas reserves, including in places which were deemed until recently the least likely to have hydrocarbon-bearing formations.
Iran's oil sector is facing US sanctions imposed in November, including a pledge by President Donald Trump to bring the country's oil exports down to zero.
Trump has backtracked on that pledge, giving a 180-day waiver to eight customers of Iranian oil and is likely to extend it, according to analysts.
"About the extension of the waiver for Iran's oil sales to some customers by the United States, we have to wait and see," Zanganeh said.