Country Report Iceland July 1998 Main report

Business news: Non-polluting fuels testing in the offing --

The German auto-maker Daimler-Benz and the Canadian generator manufacturer Ballard have expressed an interest in coming to Iceland to test a prototype bus powered by non-polluting hydrogen. The two companies have already signed a statement of intent with the Ministry of Industry and Commerce which suggests that these tests could start in two years' time, followed by further tests on passenger cars powered by methanol. Apart from this, the three parties have also agreed to explore the possibility of using hydrogen or methanol to power the Icelandic fishing fleet, and of producing and exporting these chemicals from Iceland.

-- while the aluminium smelting capacity grows

A US firm, Columbia Ventures, started production at its new aluminium smelting plant at Grundartangi in June in south-west Iceland. The plant, which was built in a record 13 months, will have a 60,000-tonne annual capacity when it is fully operational. The short time it took to construct the plant had raised hopes that it might be possible to produce to full capacity before the end of this year. However the National Power Company (NPC), which had guaranteed the power to operate the plant at 50% capacity from June 1998 and 100% capacity from the beginning of 1999, has been unwilling to alter this time schedule as it would leave NPC with minimal spare capacity. Despite this Columbia Ventures has already decided to expand the production capacity of the new aluminium plant to 90,000 tonnes by the end of 1999, and to 180,000 tonnes early in the new millennium.

© 1998 The Economist lntelligence Unit Ltd. All rights reserved
Whilst every effort has been taken to verify the accuracy of this information, The Economist lntelligence Unit Ltd. cannot accept any responsibility or liability for reliance by any person on this information