Out-Of-Round bids / Open Door Applications
In accordance with section 7(3) of Act No. 31 of 16 March 1998 on Hydrocarbon Activities, its possible to send Out-Of-Round (Open Door) applications for licenses for exploration and production of hydrocarbons in the Faroese area. When an application is received, Jarðfeingi is obligated to announce (for 90 days) the receivement of the application and the area applied for, before processing the application.
The area to be offered for licensing and the terms and conditions on which licenses will be granted are defined by the areas that have been defined in the first, second and third round (see the area at the bottom of this page).
An applicant granted a license will receive all relevant data in the licensed area free of charge.
Licenses will be granted to Faroese limited companies, or foreign limited companies with a branch registered in the Faroe Islands. The branch must be registered within 3 months after the award of a license. Please contact Jarðfeingi for guidance, firstname.lastname@example.org.
The limited company shall have a minimum equity share capital of DKK 1 million. Companies may submit applications individually or in groups. In this document the term “applicant” is also used for a group of companies submitting a joint application. In case of several companies submitting a joint application the intended operator of the license shall be stated in the application.
Jarðfeingi will only award a licence to an applicant that meets certain minimum financial, technical and other criteria, which depend in detail on the circumstances.
It is a condition for the granting of licenses that the licensee conducts the exploration activities with due regard to fishing operations and the conservation of fish stocks.
APPLICATION SHALL INCLUDE THE FOLLOWING INFORMATION, IN FOLLOWING ORDER
a) Name and address of the applicant and of the person who will serve as liaison towards the Faroese authorities in connection with the handling of the application (Please contact Jarðfeingi for guidance in this matter, email@example.com). In case of several companies submitting a joint application, the participating interest of the individual company shall be stated in the application. Furthermore the intended operator shall be stated in the application.
b) The application area defined by geographical coordinates of whole minutes of latitude and longitude, and with reference to block numbers as specified in the General Guidence for applications for Out-of-Round bids (Open Door).
c) Proposal on the work commitments which the applicant will undertake with a view to thoroughly investigate the prospectivity and to explore for hydrocarbons in the area to be covered by the license, and proposal for the timing of the activities.
d) Enclosure 1 shall contain a summary of the application.
e) Enclosure 2 shall contain a geological evaluation of the area covered by the application, with special emphasis on the primary factors affecting the hydrocarbon system in the area applied for.
f) Enclosure 4 shall contain information on company related matters.
Jarðfeingi may require additional information.
The information contained in the application and the enclosures will be kept confidential, cf. section 21 of the model license. The application, excluding enclosures, should not exceed 10 pages. The applications, including enclosures, may be written in Faroese or in English.
Applicants may contact Jarðfeingi to receive
1. Geographical coordinates for the area offered for licensing
2. Guidelines for the preparation of the above mentioned enclosures
3. Model license for exploration and production of hydrocarbons
4. Model prospecting license
For the handling of each individual application, an application fee of DKK 20.000 is due upon submission, the fee shall be paid, free of charge to:
P/F Føroya Banki
acc. no. 6460-2600058
IBAN FO31 6460 0002 6000 58
(ref. FEE 142571-2520-0700-0100)
P.O. Box 2009
A copy of the receipt shall be attached to the application
Where a license is granted to several parties jointly it is subject to the condition that a joint operating agreement is executed not later than 90 days after the license has been granted. The Minister of Foreign Affairs and Trade may require that the agreement be modified on specific points, cf. section 17 of the model license.
Within 30 days from the granting of the license the licensee shall provide performance guarantee for all its obligations and liabilities under the license. The performance guarantee is subject to approval by the Minister of Foreign Affairs and Trade who may require that such guarantee be changed or supplemented, cf. section 25 of the model license. Within 3 months after the granting of the application the licensee shall submit a proposal, to be approved by the Minister of Foreign Affairs and Trade, on how and where his onshore activities will be organised during the exploration period, cf section 16 (2) of the model license.