You know, all my life I hoped this would happen. Ever since childhood I expected it. I knew these creatures were alive somewhere, but I had no proof, scientific proof, and I had to keep it to myself, or my colleagues would have all laughed at me. -- Dr. Sampson, The Giant Behemoth
Why Iceland, i wonder? Wikipedia's info on the subject is unsatisfying.
By 1982, members of Killing Joke, especially Coleman, had become immersed in the occult, particularly the works of occultist Aleister Crowley. In February of that year, Coleman, with Geordie and Youth following shortly after, moved to Iceland to survive the Apocalypse, which Coleman predicted was coming soon. While in Iceland, Coleman and Geordie worked with musicians from the band Þeyr in the project Niceland. After a few months, Youth decided there was no indication of the Apocalypse, and decided to move back to England. Youth then began the band Brilliant with Paul Ferguson, but the latter defected and travelled to Iceland to rejoin Killing Joke with new bassist Paul Raven (previously of Neon Hearts and the rock / glam band Kitsch) in tow. After spending some time in Iceland, Killing Joke returned to England and began touring and recording again.