Sagex, Lindir Pull Out of E&P License in Dreki Area Off Iceland

The National Energy Authority received on September 22, 2009 a letter from Sagex Petroleum announcing the withdrawal of their joint application with Lindir Exploration for an exploration and production license in the Dreki Area.

The deadline for applications for exploration and productions licenses in the licensing round was on May 15, 2009. The National Energy Authority received applications from

  • Aker Exploration
  • Sagex Petroleum and Lindir Exploration

Earlier this summer, Aker Exploration withdrew their application due to a change in exploration strategy due to cooperation and later merger with another company.

As a result, the National Energy Authority will not be issuing a license for exploration and production in the first licensing round. Future licensing is being evaluated by the authorities and will be announced soon.

Communications with the oil companies that showed interest in the licensing round, but did not apply, indicate that the main reasons that they did not participate in the round was i.a. the poor economic conditions at the time of the licensing round, with the accompanying difficulties with financing the exploration, especially given the risks involved with starting exploration in a frontier area such as the Dreki Area.