The Kangan area is located in the Fars Province of Iran and is a part of the Zagros foothills belt. It differs from the northwestern Disful embayment, which holds the main oil reserves of Iran, by its situation on the Fars high which, together with Qatar arch, separated the Mesopotamian basin from the Rub Al Khali basin during Mesozoic times.

The discovery in Kangan was made in 1973 by Societe Francaise des Petroles d'Iran which acted as the operator for a European consortium (Elf Aquitaine, AGIP, Hispanoil, Fina, OEMV) in a service contract for National Iranian Oil Co. Since then, several other discoveries have been made in Fars Province in structures such as Pars, Dalan, Mar, Varavi, and Aghar, among which Pars and Nar are presently undergoing development drilling.

The gas-bearing zones are in the Lower Triassic to Permian Khuff Formation (Kangan and Dalan Formations according to NIOC nomenclature) constituted mainly of heavily fractured dolomitic and oolitic carbonate rocks of intertidal environment. Thin layers of anhydrite form the caprock. Huge east-west elongate anticlines (up to 80 km long, with vertical closure up to 2,500 m) were folded during late Tertiary and Quaternary movements to form traps, some holding more than 18 Tcf of wet gas.

The role of tear faults is important as a cause of possible gas migration. The gas originates either from the organic-rich Permian carbonate rocks or from older Paleozoic source rocks. Most of the traps are full to the spill point, and gas entrapment seems very recent if not in progress.

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