Iceland issues offshore licenses

Offshore staff

ABERDEEN, UK – Iceland’s government has provisionally awarded Faroe Petroleum operatorship of offshore exploration licenses under the country’s second licensing round.

These are in the Dreiki area, and comprise seven blocks south of the Jan Mayen ridge offshore northeast Iceland, within the Arctic Circle. The Jan Mayen microcontinent is between the conjugate margins of East Greenland and the Norwegian continental shelf.

Samples taken from the seabed on the northern part of the new license indicate the presence of Mesozoic sedimentary rocks and a working hydrocarbon system, similar to numerous oil accumulations found offshore Norway and the UK.

Faroe Petroleum has mapped various structures within the license area.

Norway’s Ministry of Petroleum and Energy has confirmed its intention to take a 25% stake in the award covering blocks IS6708/8, 9, 10, 11, and 12, via state-owned oil company Petoro. This was provided for under the terms of an agreement between Iceland and Norway.

Faroe Petroleum will have a 67.5% operating interest in these blocks, the remainder held by Iceland Petroleum. It will also take a 90% interest in blocks IS6708/1 and 2, outside the Norway/Iceland cooperation area, in partnership with Iceland Petroleum.

Orkustofnun, the National Energy Authority of Iceland, also awarded licenses to Valiant Petroleum and Kolvetni. Processing of a third application, from Eykon Energy, has been delayed to give the company time to bring in a partner with sufficient expertise, experience, and capacity to perform the license activity.


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