Landsvirkjun agrees to sign contract with Impregilo

7. February 2003

Contracts for the project will be signed following the signature of the power agreement between Landsvirkjun and Alcoa in March.

The contract with Impregilo is in line with the contractor’s bid for the construction project. The overall amount is similar to that in Impregilo’s bid after both upward and downward adjustment for modifications, additional work and adaptation of various details. The total amount of the contract is in the region ISK 38 billion ex-VAT.

Landsvirkjun accepts bids which deviate from the specifications of the tender, which involve the use of three drills for tunnels instead of two and the construction of a wider tunnel for the Jökla river bypass at the dam site during the construction phase.

It has been agreed to widen the headrace tunnel by 0.4 metres, from 6.8-7.2 in circumference to 7.2-7.6 metres. Doing so yields greater and more economical power capacity which suits the requirements of the Fjardaál smelter. Clauses have been inserted into the contract which consolidate full compliance with Icelandic wage agreements and labour legislation even further than in the tender documents.

It has been agreed that Impregilo will undertake as an additional task the full-face drilling of the section of the diversion tunnel for the river Jökulsá í Fljótsdal to the intake tunnel, involving a total of just under 10 km of the 14 km diversion tunnel. The contract amount is just over ISK 3.5 billion. Impregilo will commence work at the end of March or beginning of April. Drilling equipment will be delivered to Iceland at the end of the year.

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