Iceland-based seafood giant Samherji is facing a potential setback to its plan to build a 40,000 metric ton land-based salmon farm in Reykjanes, Iceland, after government officials raised concerns about the potential impact of the project on groundwater in the area, according to local media reports.

"The water level is sensitive, and there is a risk of significant negative effects if care is not taken," officials with Iceland's National Planning Agency said, according to an article in Icelandic publication RUV.

The agency said it is imperative to carry out extensive monitoring, intensify research significantly and divide the structure of the farm into phases so that the effects of each phase are known before the next one begins.