The Iceland Chamber of Commerce has encouraged the Icelandic treasury to issue permits for oil research and production in the Dragon Zone (Drekasvæðið), off Iceland’s northeast coast. Oil discovery could have enormous benefits for the population, the Chamber argues.
According to a September 18 report issued by the Chamber, exploration permits would include limited risks for the authorities. Additionally, permits issued by the government could accrue earnings, even if no oil were discovered.
Based on the Chamber’s preliminary calculations, oil resources within Iceland’s maritime law could multiply the state’s total earnings by 10 to 20 times based on current conditions.
Research and oil exploration in the Dragon Zone has been ongoing for approximately 40 years, with several permits issued in the 21st century. A portion of the area is under a joint agreement by Iceland and Norway, which stipulates reciprocal utilisation rights. In 2021, the coalition government’s policy covenant specified that oil permits would not be issued within Iceland’s maritime zone.
Earlier this year, Minister for Environment, Energy and Climate Jóhann Páll Jóhannsson claimed that oil exploration was not on the agenda. In response to the Chamber of Commerce’s report, Jóhann said that contemporary data on oil search needed to be reviewed.
“I will not participate in creating overblown expectations among the nation about massive financial gain from oil search and production,” he said at Alþingi, RÚV reports.
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