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Landsvirkjun and Þeistareykir ehf. sign agreements for consultancy services for planned geothermal power stations in North East Iceland

October 24, 2011


Landsvirkjun and Þeistareykir ehf. today signed agreements with the engineering companies Mannvit hf. and Verkís hf. for consultancy services for the planned geothermal power stations in North East Iceland. They cover the design and writing of the tender documents and the final design for the planned constructions of power stations of up to 90 MW at Bjarnarflag and up to 90 MW at Þeistareykir along with assistance with the monitoring of the installation of machinery and electrical equipment.

The project was offered for tender in the European Economic Area and tenders were opened last 9 August. Two tenders were received for the project and they were opened in two steps. In the first step, the part of the tender was opened that contained information on the competence of bidders. Following this, the evaluation committee examined tenders and decided which bidders fulfilled the requirements on competence. The evaluation committee's conclusion was that the tenders from Mannvit hf. and Verkís hf. met requirements for competence. Following that conclusion the price bids from Mannvit hf. and Verkís hf. were opened.

The total amount of the agreements was for just over ISK 2.9 billion including VAT, which was 89% of the cost estimate.



Construction of the Bjarnarflag Power Station scheduled to start in the summer of 2012.

Landsvirkjun and Þeistareykir ehf. announced at the end of May that the companies would speed up research on the geothermal areas at Bjarnarflag and Þeistareykir during the summer in order to meet increased demand from purchasers of energy in the area and Landsvirkjun has now commenced negotiations with five potential purchasers of energy in the area.

Concurrent with preparatory work for the construction, work is also being done on licences for the planned power stations and before the end of 2011 Landsvirkjun intends to apply to the National Energy Authority for a permit to operate a 45 MW power station at Bjarnarflag and Þeistareykir ehf. for a 90-100 MW power station at Þeistareykir.

Given that the required permits be issued, work is scheduled to commence on the first stage of the Bjarnarflag Power Station in the summer of 2012 (45 MW) and activation will take place at the end of 2014. It is planned that construction of the Þeistareykir Power Station will commence in the latter part of 2012 and that the first stage of the power station (45 MW) will be activated in the middle of 2015 and the second stage (45 MW) in the latter half of 2015. The work plan endeavours to ensure sustainability of the geothermal areas in question.

Evaluation of environmental impact of a 90 MW power station at Bjarnarflag and a 200 MW power station at Þeistareykir is completed and steam for 45 MW has been harnessed at each location.

Research costs amount to about ISK 12 billion

Landsvirkjun and Þeistareykir ehf. have, during the last 10 years, invested about ISK 12 billion in research in the geothermal areas at Þeistareykir, Krafla and at Bjarnarflag in North East Iceland and have developed a knowledge base on preparation work for power stations driven by geothermal steam, in that area. The objective of the research is to evaluate energy capacity, the production characteristics of the area and the possibilities for harnessing in phased development.

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