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Ithaca Energy on the Icelandic Continental Shelf

Ithaca Energy has bought the British oil- and gas exploration company Valiant Petroleum for GBP 203 million (approximately USD 310 million), in cash and stock.

Ithaca-Energy-logoIthaca Energy is a North Sea oil and gas exploration, development and production company with offices in Calgary, Canada and Aberdeen, Scotland. The Company was incorporated in Canada in 2004. Ithaca’s strategy is to grow through project asset acquisitions, development of assets within the portfolio and through license rounds.

Smaller oil producers and explorers in the North Sea are consolidating in a drive to revive flagging output in British waters. The deal will enable Ithaca to double its 2013 production forecast from oilfields in the North Sea, to 14,000-16,000 barrels of oil equivalent per day. Ithaca has stated  the deal will help it transform itself into a leading mid-cap North Sea oil and gas operator, with proven and probable reserves of about 74 million barrels of oil equivalent.

Iceland-Oil-Exploration_Faroe-Petroleum-Valiant-Petroleum-litud-areas-DrekiIn a study published in last December, the University of Aberdeen forecasted that British oil output from the North Sea will rise in the next few years, reflecting more investment, high prices and tax breaks. What is more interesting, in an Icelandic perspective, is that Ithaca Energy now becomes a direct player in oil exploration on the Icelandic continental shelf. Last year (2012), Valiant Petroleum was awarded a license for exploration and production of hydrocarbons in the Dreki Area, Northwest of Iceland (area marked with blue color on the map).

According to movements on the stock market it seems that the acquisition is expected to strengthen the projects that were part of Valiant’s portfolio. This may be good new for Iceland. When the deal was announced, Valiant’s share price rose 35 per cent. How the aquisition will affect exploration on the Icelandic continental shelf will be realized in the coming summer and years.

Powerful Partnership with Reykjavik University

The Icelandic Energy Portal recently signed up for a partnership with the the School of Science and Engineering at Reykjavik University (RU).

Reykjavik-University-studentsThe School of Science and Engineering was established in 2005, following the merger of Reykjavik University and the Technical University of Iceland. The School is one of the largest academic schools in Iceland. Reykjavik University is Iceland’s largest private university, with more than 3,000 students and over 500 employees.

The  School of Science and Engineering offers three year BSc engineering programmes, variety of diploma programmes in technology, a BSc programme in constructing architecture, and graduate studies (including MSc and PhD programs). Languages of instruction are Icelandic and English. Reykjavik University is located at the heart of Reykjavik, the capital of Iceland.

Reykjavik UniversityThe Reykjavik University’s School of Science and Engineering emphasizes excellent teaching, groundbreaking research and strong ties to industry and institutions working in the relevant fields. The School places a strong emphasises on having active research and development. Most faculty members are actively engaged in scientific work and the published output from faculty has increased rapidly in the last few years.

By the partnership with Reykjavik University, the Icelandic Energy Portal will cooperate with faculty members and students from the School of Science and Engineering on numerous issues related to energy. The partnership will bring attention to many different topics and subjects, introducing the work and research by students and staff of the School.

China and Iceland Strengthen Geothermal Cooperation

Iceland has signed a free trade agreement with China, becoming the first European country to do so.

Iceland-China-Free-Trade-Agreement-april-2013-2Iceland’s Foreign Minister Össur Skarphéðinsson signed the deal with China’s Commerce Minister Gao Hucheng in Beijing couple of days ago, bringing to a close six years of talks. The free trade agreement will lower tariffs on a range of goods and is expected to boost seafood and other exports from Iceland to the world’s second-largest economy.

During talks following a formal welcoming ceremony at the Great Hall of the People in the center of Beijing, Chinese Premier Li Keqiang said the free trade agreement was “a major event in China-Iceland relations”. He added that the agreement will “increase the soundness of business transactions and presumably the interest among Chinese and Icelandic companies that are cooperating in geothermal power”.

China is already benefiting from Iceland’s expertise after 80 Chinese students graduated from the United Nations University Geothermal Program in Reykjavik. The signature of the free trade agreement between China and Iceland comes only a year after the countries signed a special deal  to increase co-operation in the development of geothermal energy. 

When in Iceland in April 2012, China’s then-Premier Wen Jiabao concluded the agreement during the first stage of a four-nation European tour.

China-Geothermal-AreaIceland is on the forefront in geothermal energy utilization and is going to work with China, the world’s largest energy consumer, to develop geothermal resources. In an effort to meet an exponentially growing energy demand, as well as reduce its greenhouse gas emissions, China has become a leading investor in alternative energy technologies. China Petroleum & Chemical Corporation (Sinopec), the second largest oil and gas producer in the country, plans to make geothermal energy one of its main businesses.

The geothermal strategic partnership with China offers Iceland serious economic potential. Iceland is already working with India, countries in East Africa, Abu Dhabi, and several western countries to develop geothermal power projects. Geothermal energy resources are widely discovered in China, making the country riche in geothermal energy. The country is still in its infancy of developing and utilizing these natural resources, thus offering a huge market potential.

What Explains the High Energy Intensity in Iceland?

The worlds major economies have gradually been reducing their energy intensities (using less energy to produce one unit of GDP). This, for example, applies to all the Scandinavian countries. However, this does not apply to Iceland; Iceland has been increasing its energy intensity.

Nordic-Energy-intensity-1990-2011-with-China-Germany-Japan-USA

Reducing energy intensity means increasing the energy efficiency in the economy. China is an example of a country where the trend towards more energy efficiency has been evident. As the Chinese economy has increased productivity and moved towards higher value products, GDP has increased much faster than energy consumption.

Industry is often classified into three sectors;  primary, secondary, and services (tertiary sector). The primary sector involves the retrieval and production of raw materials, while the secondary sector involves the transformation of raw or intermediate materials into goods. The services- or tertiary sector involves the supplying of services to consumers and businesses.

Economies previously dominated by primary and secondary sectors, such as in Denmark, have steadily decreased their energy intensities since 1990. The economies in Sweden and Finland also follow this trend – although their energy intensity increased in the early 1990s due to an economic recession.

The reason for the present high energy intensity in Iceland, is the recent expansion of energy-intensive industries in the country. It is especially the aluminum industry that has expanded at a much faster rate than the general economy in Iceland has grown.

On average, industry accounts for about a third of the energy use in the Nordic countries. This is considerably higher than in most other developing countries.

Nordic-Energy-Consumption-by-Sector-20101

Both Iceland and Norway have significant metal manufacturing. This is due to historically cheap and plentiful hydroelectricity (and geothermal energy in Iceland). Because of the electricity consumption by the aluminium industry and other energy-intensive industries, Iceland and Norway actually have the world’s highest electricity consumption (and production) per capita!

Partnership with the University of Iceland

The Icelandic Energy Portal is an information source about Icelandic energy issues. The Portal was launched in June 2012. Our ambition is to cover all issues relating to the Icelandic energy sector and become the most comprehensive and user-friendly information source and database on the subject.

University-of-Iceland-research-students Recently, we signed a formal agreement on cooperation with the University of Iceland. This, for example, means that we will be presenting research and studies by professors, teachers and students of the university.

The University of Iceland is a progressive educational and scientific institution, renowned in the global scientific community for its research. It is a state university, situated in the heart of Reykjavík, the capital of Iceland. A modern, diversified and rapidly developing institution, the University of Iceland offers opportunities for study and research in almost 300 programmes spanning most fields of science and scholarship.

University-of-Iceland-studentsThe University of Iceland employs a large number of highly-educated and qualified academics. The vast majority of the permanent academic staff holds doctorate degrees and has studied and participated in research at respected foreign universities. Consequently academics at the University of Iceland are part of a strong and far-reaching global network, and many of them are leaders in their respective fields within the international scientific community.

The University of Iceland collaborates with hundreds of international universities and research institutes in student exchanges, research, faculty exchanges and more. All of the University’s students have the option of taking part of their degree at universities overseas. Hundreds of international students are enrolled at the University of Iceland, and their number is growing. The University employs numerous international guest professors and scientists and brings in lecturers from abroad almost on a daily basis. Hence the University is made up of a vibrant and multi-dimensional community of people.

University-of-Iceland-research-students-2Today, the University of Iceland is in the midst of a vigorous period of growth, currently ranked as one of the top 300 universities in the world. Research, scientific work and teaching at all levels are thriving, while remarkable achievements are attained on a regular basis with regards to improved facilities at the school. Recent and current undertakings serve to vastly enhance scientific activities and instruction at the University of Iceland and to improve facilities and opportunities for its students. Much more information about the university can be found on its comprehensive website.