Iran's second-largest gas field is expected to start producing at a rate of about 100 million cu ft per day (mcf/day) by March, the project's operator told oil ministry news website Shana on Monday.

Kish has an estimated 66 trillion cu ft of gas reserves, making it Iran's second-largest behind the South Pars field it shares with Qatar.

However, slow progress in tapping Iran's share of South Pars threatens serious gas shortages in a country where demand has grown rapidly over the past few years, oil minister Bijan Zanganeh warned this month.

Although the start of the first production well at Kish will supply only about 2.8 million cubic metres (mcm) per day (100 mcf/day) in a country that consumes around 430 mcm/day, Zanganeh is applying pressure on developers for output to be ramped up rapidly to at least ten times that volume.

"Zanganeh underlined the necessity for early production from Kish gas field ... and ordered that the necessary measures be undertaken to remove obstacles to development of the field," Homayoun Kazemeini, the Kish project manager at Petroleum Engineering and Development Company (Pedec), told Shana.

"The necessary gas for the power plant in Kish Island will be supplied from two wells in this field," he said, adding that one well alone would be enough to supply the plant.

In addition to natural gas that Iran needs for power generation, Kish contains an estimated 514 million barrels of gas condensate, a light oil, which could be exported.

Zanganeh has warned that Iran is likely to produce about 30 billion cu m (bcm) less gas than it will need this year, forcing it to use costly and contaminating oil products to fuel power stations.

Though the latest estimates by BP suggest that Iran holds the world's largest gas reserves, Western sanctions have slowed its gas production growth over the past decade. Demand, meanwhile, has risen rapidly to about 156 bcm in 2012, making it the third-largest consumer behind the United States and Russia, according to BP data. - Reuters