Upcoming Contract for South Iceland Silicon Plant Skip to content

Upcoming Contract for South Iceland Silicon Plant

It is hoped that an agreement on the construction of an ISK 18 billion (USD 155 million, EUR 113 million) silicon plant in Helguvík, southwest Iceland, can be signed on Friday. According to plan, construction is to begin in three months.

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A geothermal borehole in southwest Iceland. Photo by Páll Stefánsson.

A lot by the harbor in Helguvík has been reserved for the plant. The project has been under preparation by an American company and its Icelandic partner for four years, Stöd 2 reports.

The contract was in the final stages in late January but there were still a few loose ends, especially concerning an investment agreement with the state, which prevented the contract from being signed at that point.

The silicon plant requires 65 MW of electricity, which is already available in the system, and it is hoped that agreements on power supply from Landsvirkjun, the national power company, and the local HS Orka can be made on Friday.

If the deal is finalized on Friday and construction can begin in May, 150 people would have to be hired. The southwestern Sudurnes region is the hardest hit by unemployment, so the move would probably be welcomed by most people.

The ISK 18 billion investment would be the second-largest since the banking collapse, after the renovation of the aluminum smelter in Straumsvík by Hafnarfjördur, and would indicate the advance of the restoration of the Icelandic employment market.

Click here to read more about the renovation of the smelter in Straumsvík and here to read more about unemployment in Iceland.

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