China National Offshore Oil (CNOOC) has teamed up with Eykon Energy to apply for a license to explore and produce oil and gas in Arctic waters, offshore Iceland.

If CNOOC’s application is accepted and is awarded a license, it would be the Chinese company’s first venture into offshore Arctic oil drilling, reported The Wall Street Journal.

CNOOC said it has been invited by the government of Iceland and Eykon Energy to participate in its offshore oil and gas exploration project, which is currently under negotiation.

CNOOC and other Chinese oil companies held meetings with Russia’s state-controlled Rosneft head Igor Sechin, during his visit to China in the beginning of 2013, about potential offshore projects in the Russian Arctic.

Earlier in 2103, Iceland awarded two licenses from its first round to sell acreage in the Dreki area, northeast of Iceland and neighbouring coastal waters in oil producing Norway.

Iceland’s National Energy Authority hydrocarbon licensing manager Thorarinn Sveinn Arnarson said that Eykon Energy applied for a license in the tender round, however could not proceed further without a partner.

"Now we can evaluate the technical merits of the application and the qualifications of the companies, both technical and financial, before we make our decision," Arnarson added.