Iran starts first drilling for oil in Caspian Sea

TEHRAN (Reuters) - Iran started drilling the first exploratory oil well in its territorial waters of the Caspian Sea, official IRNA news agency reported on Sunday.

"The drilling of the first oil well is taking place at the dept of 1,550 meters in Iran's territorial waters of the Caspian Sea," a senior oil official Hedayatollah Khademi, who heads the state owned Iran's North Drilling Company, was quoted by IRNA as saying.

State television also reported the move was the first from the three planned drillings to estimate the amount of recoverable oil available in Caspian Sea waters.

Iran is the world's fifth-largest crude exporter, with most of its existing reserves located in its southeast and offshore in the Gulf.

The Islamic state, which is at odds with the West over its controversial nuclear activities, lacks the latest technology and sufficient financial investments in its oil and gas sector.

Head of the National Iranian Oil Company (NIOC) Seifollah Jashnsaz said early in February that the country's oil and gas sector needed to attract more foreign investment.

Jashnsaz said Iran is in talks with five European and Asian energy firms for some $30 billion worth of oil and gas contracts.

(Writing by Reza Derakhshi; Editing by Mike Nesbit)