German bremenports has reached an agreement with Icelandic partners to form a company with an aim of establishing a port and industrial location at Finnafjord.
Under the deal, signed on April 11, the parties would form the Finnafjord Port Development Company (FFPD) for the project, expected to be developed over the next several decades.
bremenports will initially hold 66 per cent of the shares in the port development company. EFLA will have a shareholding of 26 per cent and the remaining 8 per cent will be held by the Icelandic municipalities.
According to the Memorandum of Understanding, the project covers a deep-water port at Finnafjord in the municipality of Langanesbyggð, to the south-east of Thórshöfn in the north-east of Iceland and an industrial park for supplies to the port and for industrial/commercial activities.
Additionally, the project covers infrastructure development for the port and the planned industrial enterprises at the location, including electricity and water supply as well as road connections; and evaluation and implementation a duty-free and tax-free zone in connection with the operation of the port and industrial facilities.
Full implementation of the project could take more than 40 years, the parties said, adding that the entire costs of quay construction etc. are to be assumed by the concessionaires. Also, there are public infrastructure links which have to be closed between the infrastructure to be built by the concessionaires and the national road, energy grid, water and telecommunications grids.
“The port project in Iceland provides a concrete long-term perspective for development that will undoubtedly continue for several decades. It creates conditions that will enable sustainable development of the Arctic and will help to make the emergent new shipping routes safer,” Martin Günthner, Senator for Economic Affairs, Labour and Ports, said.
The site for which plans are now to be drawn up is comparatively large and has space for the construction of 6 km of quays and the development of more than 1200 hectares of hinterland. The water in the bay is almost 20 metres deep.
The initial idea for this project dates back to the year 2007, when the Icelandic central government, together with the municipalities of Langanesbyggð and Vopnafjarðarhreppur, commissioned EFLA, an Icelandic consultant company, to investigate the feasibility of creating a port and industrial location at Finnafjord and to find suitable partners for planning the project.
A corresponding cooperation agreement was signed between EFLA, bremenports and the municipal governments in 2014. Following the positive outcome of the preliminary investigations, the preparation of this new agreement began in 2016.