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Andfjord Salmon says decision to fast-track Kvalnes project was right move


Bleik's beach on the Andøya island in Norway (Photo: Andfjord Salmon)

Andfjord Salmon today said its decision to speed up its Kvalnes project has placed its land-based fish farm in a better position.

Last December, the Norway-based aquaculture company announced that it has raised US$10 million and intends to use the net proceeds from the placement to fast-track development of its Kvalnes Phase 2 land-based facility in Kvalnes, Andøya.

The main purpose was to accelerate the development of the production capacity at Kvalnes from 1,260 tons to 12,600 tons, while at the same time reducing overall project risk and biological risk for the start pool.

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“The decision we made in December to fast-track the development of the full Kvalnes area was smart as it reduces both overall project execution risk for the area development and biological risk for the start pool,” said Martin Rasmussen, chief executive officer of Andfjord Salmon, in a press release. “This year’s successful hook-up of the first pool has further de-risked the entire project. We are pleased with the progress we are making.”

The company’s Fourth Quarter report said fast-tracking the project achieved the following benefits:

  1. Moving blasting and excavation work for Kvalnes Phase 2 (to reach full 12,600 tons) 6 months forward allows:
    – Fast-tracking development of Phase 2
    – Significantly de-risks expansion
    – Allows more time for testing of Kvalnes start pool
  2. Results in saved expenses related to de-mobilization and mobilization of required machinery, and does not otherwise affect total capex
  3. Reduces biological risk for fish in Kvalnes Phase 1
    – Eliminates risk that fish suffers stress from noise and vibration from nearby construction work
  4. Updated plan only marginally affects release of first smolt for Phase 1 and time to first revenues

Andfjord Salmon is now finalizing electrical and automation installations, as well as installation of less time-critical pipeline connections, before the first pool is ready for water testing.