Iceland continues to open up offshore exploration

oil-barrel24Iceland is continuing to invest in offshore oil exploration amid the country’s ongoing economic recovery. On Friday 4 January, officials in Reykjavik signed another deal for tapping fresh reserves in the country’s territorial waters. Once again, the agreement involves the aid of Norway, this time via state-owned firm Petoro, which will claim a 25 percent stake in licenses that were awarded to London-listed Faroe Petroleum and Valiant Petroleum in December.

Speaking about the agreement, Gudni Johannesson, director general of the National Energy Authority in Reykjavik, told Reuters reporters, “It brings us some optimism that we have such possibilities. This will not solve the economic crisis we have now, but it will help us through the next one.”

Meanwhile, Petoro spokesman Sveinung Sletten said, “We can contribute with our knowledge from the Norwegian experience (in oil exploration).”

Norway – a state in which oil has manifested itself as the most important industry over the last several decades – is able to claim up to a quarter of Icelandic exploration licenses as a result of a treaty signed between the two nations in the early 1990s.

Officials say that drilling in the newly-licensed area will likely not begin for at least five years, as an extensive survey of the seabed will take around two years.