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Northwest Iceland Signs Contract for New Aluminum Smelter

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Northwest Iceland Signs Contract for New Aluminum Smelter

Alcoa Fjarðaál aluminum smelting plant

Photo: Páll Stefánsson.

Municipalities in Northwest Iceland have signed a declaration of intent and a cooperation agreement with Klappir Development ehf. on the construction and operation of a 120,000 ton aluminum smelter they hope to build at Hafursstaðir in Skagabyggð.

A joint statement came on Friday from the municipalities of Blönduósbær, Húnavatnshreppur, Húnaþing vestra, Sveitarfélagið Skagaströnd, Skagabyggð and Sveitarfélagið Skagafjörður.

To compare the plan to existing smelters, the annual production at Straumsvík is around 190,000 tons, around 260,000 tons at Grundartangi and 350,000 tons in Reyðarfjörður.

The joint statement says that the agreement has been made as a direct result of a parliamentary proposal, approved by Alþingi in January 2014, for national and local authorities to work together to push economic development in the Northwest, RÚV reports.

The plan is for the new factory to run on electricity from Blönduvirkjun dam and it will require 206 MW of power.

The statement adds that 240 jobs will be permanently created, and up to 800 temporary construction posts.

It is worth noting that Northwest Iceland does not include the Westfjords, which is counted as a separate region.

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