Northeast Iceland Community Set to Profit from Oil Skip to content

Northeast Iceland Community Set to Profit from Oil

The general plan of the municipality Langanesbyggð in Northeast Iceland assumes that a harbor for large vessels will be made in Finnafjörður, a fjord in Bakkaflói between the villages Þórshöfn and Bakkafjörður, might also become a location for an oil refinery and a factory for filling gas containers.


The pier in Bakkafjörður. Photo by Páll Stefánsson.

If these plans work out, the municipality estimates that the inhabitants of Þórshöfn (current population: 380) could increase to 5,000 in 15 years, as the oil refinery and factory would employ 800 and 200 people, respectively, reports.

The harbor in Finnafjörður might also serve as a center for security and service, as well as a helicopter service.

However, these plans depend on oil being found in the Dragon Zone off Northeast Iceland and cargo transport across the Arctic Ocean being realized.

The district council is split on the matter. A farmer in Finnafjörður is absolutely against these plans, saying landowners have hardly been consulted at all.

“I don’t like this intervention with nature. It must undergo significant changes when vegetated land is taken over by concrete. This is also the location where I run my business and where I make my living,” Reimar Sigurjónsson, farmer at Fell, told Morgunblaðið.

According to, planning consultant Halldór Jóhannsson has assisted with the making of the general plan for Langanesbyggð.

Halldór is also spokesperson for Chinese investor Huang Nubo who intends to lease the nearby piece of land Grímsstaðir á Fjöllum and build a luxury hotel there.

The general plan is scheduled to be discussed in the district council next week, after which it will be sent to the government for reviewing.

Click here to read more about oil exploration in the Dragon Zone and here to read more about Huang’s plans.


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