It seems that Icelandic reporters (and me apparently) are not as well versed on the internet as reader "wetdog" who rightly pointed out that this film is indeed Faust and there is a big whopping article about this project on Variety.com.
News trickled out today here in Iceland that Russian director Aleksandr Sokurov is planing to shoot his next feature in part over here. Nothing is known as to what the film will be about but local actors have been hired to take part in the project, the biggest role going to veteran actor Sigurdur Skulason (The Sea, Children and Astropia). Sokurov is of course best known over here for his single shot epic The Russian Ark which has won tons of awards all over the world and is considered as being among the best 100 directors of world cinema.
More most likely to come when news come through.
It's Faust.
http://www.variety.com/article/VR1118003512.html?categoryid=3620&cs=1
Whether it shoots in the Czech Republi or Iceland, color me intrigued.