Iceland’s Minister for Foreign Affairs Ingibjörg Sólrún Gísladóttir and her Norwegian counterpart Jonas Gahr Stoere signed an agreement yesterday on exploitation rights for fossil fuel resources in an area on the ocean floor belonging to both countries.

The agreement states that Iceland is entitled to 25 percent of the potential oil production in Norway’s territory in their joint fossil fuel exploitation area between Iceland and Jan Mayen, dubbed the “Dragon Zone,” and Norway to 25 percent of the potential oil production in Iceland’s territory, Morgunbladid reports.

Gahr Stoere (left) and Gísladóttir sign the agreement on fossil fuel rights. Copyright: Icelandic Photo Agency.

According to a statement from Iceland’s Foreign Ministry, the agreement is a prerequisite for issuing permits for oil exploration and potential harnessing of fossil fuels in the Dragon Zone. Such permits are scheduled to be issued next year.

During their meeting, Gahr Stoere and Gísladóttir also discussed Norway’s proposed loan to Iceland and the professional assistance with a planned investigation into the events that led up to the Icelandic banking crisis.

Yesterday Gahr Stoere held a well-attended open presentation in the University of Iceland entitled “Iceland and Norway – neighbors in the far north” where he discussed the countries’ joint interests in the North Atlantic, including gas, oil and fish resources, scientific research in the field of climate issues, the opening of seaways in the Arctic and defense matters.

Gahr Stoere also discussed cooperation with Russia, emphasizing the importance of continued positive relations with Russia despite criticism of their coercion in Georgia.

Click here to read more about the Dragon Zone.