(Press Release): Landsvirkjun has signed a new Power Purchase Agreement with Icelandic Silicon Corporation, a company where Globe Speciality Metals (NASDAQ: GSM) is majority shareholder.
According to the agreement Landsvirkjun will provide energy for the company’s new 40,000-ton silicon metal production facility in Helguvik, Southwest Iceland. The plant is expected to come online in mid-2013 and will require 65 MW of power. The agreement is structured in two phases; initially, Landsvirkjun will provide 35 MW of energy with the remaining 30 MW supplied by HS Orka. Beginning in January 2016, Landsvirkjun will supply all of the energy to the smelter.
“We have been aiming to increase the diversity of our client base. This agreement is an example of the materialisation of that strategy. Silicon metal represents a new industry in our portfolio, which we believe has good long-term prospects in Iceland where power is generated from renewable energy sources only,” said Dr. Hordur Arnarson, Landsvirkjun’s CEO.
The new contract is a long-term contract. Prices are denominated in Euros, along with fixed annual price increases. The parties have agreed to keep the price confidential at present time. The agreement is subject to standard conditions precedent, including approval of both companies’ Boards of Directors and for few other conditions that Icelandic Silicon Corporation will complete no later than June 15th 2011.
Landsvirkjun is one of Europe’s leading renewable energy companies with 1900 MW installed capacity.