Iceland’s government has issued several new offshore exploration licenses. According to reports, Faroe Petroleum has been granted a provisional exploration license by the Icelandic energy body Orkustofnun. This gives the firm access to a seven-block area on the Jan Mayen Ridge in the Dreki region near Iceland’s northeast coastline.
The Jan Mayen Ridge is located inside the Arctic Circle, between the continental shelves of Norway and East Greenland. Recent surveys of the area have uncovered a geological makeup consisting of a functional hydrocarbon system and Mesozoic sedimentary build-up, similar to that found in oil-rich offshore regions near the coasts of Britain and Norway.
Norwegian officials have announced their intention to take a 25 percent stake in blocks IS6708/8, 9, 10, 11 and 12, as per pre-established terms between Reykjavik and Oslo. Faroe Petroleum will take a 67.5 percent share, whilst the remaining 7.5 percent will go to Iceland Petroleum.
Meanwhile, blocks IS6708/1 and 2 are situated outside of the Norway-Iceland cooperation zone; Faroe Petroleum will have a 90 percent share in these blocks with Iceland Petroleum taking the remainder.
Orkustofnun has also recently awarded licenses to Kolvetni and Valiant Petroleum, whilst Eykon Energy’s application has been temporarily put aside while the firm finds an experienced partner for the effort.