Iran broke ground on a nuclear power plant in the country’s southwestern Khuzestan region on Saturday, state news agency PressTV reports.

The Karun plant will be located on a 50ha site and is expected to take eight years to build at a cost of around $2bn.

Mohammed Eslami, head of Iran’s Atomic Energy Organisation, said: “The government is moving towards the production of low-cost energy and fuel, therefore the development of nuclear power plants is on the agenda of this organisation.”

The reactor will be of the pressurised water type and will generate up to 300MW of electricity. Eslami said the project would be the first of a number of small nuclear stations that would eventually account for up to 20% of Iran’s installed capacity.

According to PressTV, the plant will be built using Iranian technology. It said: “In recent years, Iranian scientists have made remarkable progress in the field of peaceful nuclear technology despite the tough sanctions imposed by the West.”

Iran presently has one nuclear power plant at its southern port of Bushehr that went online in 2011 with help from Russia.