After banking crisis, Iceland launches search for black gold After banking crisis, Iceland launches search for black gold

January 05, 2013 - 1:05:35 am

REYKJAVIK: Iceland yesterday awarded two exploration and production licences to foreign energy firms hoping to find oil and gas in the northeastern waters off the North Atlantic island’s coast.

Icelandic energy authority Orkustofnun said in a statement that it had “signed and issued licensing documents for exploration and production of hydrocarbons in the Dreki area”. The island nation will get a helping hand from neighbouring Norway, Europe’s second largest oil producer, after Oslo took a 25 percent stake in both licences awarded on Friday through state-owned oil company Petoro.

“This is of course an important step, these are the first real licences that we believe will be used and they call for extensive research in the area,” said the Icelandic Minister of Industries and Innovation, Steingrimur Sigfusson, referring to a derailed licensing round in 2009.

“The Norwegian participation is also important, we think that it strengthens the matter in every way, not least to have the support of Norway and its massive knowledge in this field,” he added. Norway and Iceland signed an agreement in 1981 that gives Norway the rights to a share of all exploration and production on the Jan Mayen Ridge, which separates the Norwegian Sea from the Greenland Sea. “It’s the first time that the Norwegian government takes assets directly in licences outside the Norwegian border,” said the Norwegian Minister of Petroleum and Energy, Ola Borten Moe. AFP