Iran Khodro says its TC7 engine has successfully passed tests in terms of performance and maintenance standards.

TC7 engine uses compressed natural gas (CNG) but at earlier stages of its production, only petrol models will be supplied.

"The fuel consumption of TC7, which was initially used in IKCO Soren, stands at 7.3 L/100km," says an IKCO statement. "It can release torque of 215 N/M and 150HP.

"The engine enjoys Euro4 emission standards and European On Board Diagnostics (EOBD). Its Euro4 standards can be promoted to Euro5."

TC7 is of national EF class which is co-designed by Iran Khodro Power Train (IPCO) and Germany's FEV in a joint project.

EF engines have been designed initially based on compressed natural gas, but it is capable of working with gasoline as well.

Iran Khodro has already produced EF7, EF4 and EFD engines of the same class.