Cold Country, Hot Metal

By David Einstein

Over the years, Bechtel has worked in some 140 countries. But until recently, the company had never undertaken a project in Iceland.

That changed in 2003, when Alcoa asked Bechtel to build a 346,000-tonne-per-year aluminum smelter on Iceland’s eastern coast. The Fjarðaál project, now well under way, is Alcoa’s first new primary smelter in 20 years—and Bechtel’s first experience in this island nation near the Arctic Circle. At the budgeted cost, it also is the largest private investment in Iceland’s history.

The project site is at the inner edge of a large, glacier-fed fjord that empties into the Norwegian Sea. Like most of Iceland, the area is sparsely populated—the nearest town, Reyðarfjörður, is about eight kilometers away and is home to about 650 residents. Iceland as a whole claims fewer than 300,000 inhabitants, about 70 percent of whom live in Reykjavik, the capital city located on the southwestern coast.

Iceland is volcanic—most homes in the country get their heat and hot water from renewable geothermal energy. That means that domestic heating creates virtually no greenhouse gas emissions—something few, if any, other countries can claim.

The climate is much more temperate than the country’s name or northern latitude would suggest. At the Fjarðaál project site, winter temperatures hover around zero Celsius, and there is little snow accumulation. Bechtel has projects in several places where it gets colder, including Alaska, Russia, and Kazakhstan. Even Montreal, home to Bechtel’s global Aluminum Center of Excellence, gets more snow.

Fjarðaál (Icelandic for “aluminum of the fjords”) is an eight-hour drive or a one-hour flight from Reykjavik. The drive can be worth it, says Bechtel Project Manager Joe Wahba, because it offers a scenic tour featuring glaciers, geysers, and big waterfalls. “It’s like a combined getaway to Alaska, Yellowstone National Park, and Hawaii without being in the USA,” he says.

The project site offers a spectacular view of nearby snow-capped mountains, and in spring and autumn one can see the colorful northern lights, a phenomenon caused by solar winds passing through the atmosphere at the magnetic North Pole. But it still can be a desolate place, especially in winter, when the sun is above the horizon for only a few hours each day (in summer, there is almost perpetual sunlight).

The biggest natural challenges facing the Fjarðaál team are the remote location of the site, and winds that can exceed 140 kilometers per hour, shutting down crane operations and other work. Bechtel can’t stop the wind, but it did find a workaround. “Our plan includes a high degree of assembly on the ground and preassembled modules,” says Wahba. “We buy things—even entire buildings—preassembled, then put them in place as weather conditions allow. And shifting work off the site also enables us to reduce construction costs.”

The swirling, at times treacherous wind also necessitated innovative construction techniques to keep workers safe—always the top priority on a Bechtel project. For instance, roofs for the pot rooms are erected from platforms inside the structures, thereby avoiding the need to have people working outside atop the roof.

By March 2006, the project had completed more than 2 million job hours without a lost-time accident. When the 1-million-hour milestone was reached in December, Icelandic Minister of Industry and Commerce Valgerður Sverrisdóttir said at a celebration, “This great achievement does not only matter for the companies involved but for Iceland as a whole and the future of construction in this country.”

Fjarðaál is a showcase for Bechtel’s global reach. Ships have brought in steel and pots from China, concrete from Iceland and Norway, and heavy equipment from Europe, the Middle East, China, India, and North America. Carbon anodes used in producing aluminum are coming from a new plant Bechtel is building in Mosjøen, Norway, for an Alcoa joint venture.

Many of the suppliers are the same ones Bechtel used in the expansion of the Alba aluminum smelter in Bahrain (and in a current smelter project in Oman). “Bechtel helped develop industries in the Middle East for supporting the aluminum industry, and the benefit of that is starting to show up in other smelters,” says Wahba.

Engineering also has been an international affair involving Bechtel offices in Montreal and New Delhi, Icelandic partner HRV Engineering Group, and BPR-Bechtel of Canada, which designed the casthouse where the final products will be made.

The project consists of a 336-pot potline, a rodding shop, the casthouse, heat recovery and water treatment plants, and related utilities and administration facilities. Power for the complex will come from a new hydroelectric plant farther inland (built by others).

Initial work after groundbreaking in July 2004 included concrete and steel construction, and cladding of buildings. Mechanical work began at the end of 2005 and included the potline and the cathode rodding facility. The first hot metal is scheduled for April 2007.

In keeping with Alcoa’s commitment to protect the environment, the project has been designed for minimal impact. State-of-the-art scrubbers will minimize air emissions, and no process water will be discharged. In addition, spent potlining material will be taken out of the country for reprocessing.

To keep the local community up to speed on project developments—and to address concerns—Bechtel has created an extensive community relations program with multiple ways to reach people. “Our main goal is to provide information and listen to people,” says Community Relations Manager Björn Larusson.

A newsletter featuring project updates and information about employment and contracting opportunities comes out four times a year. Regular community meetings are held, and a community council committee helps identify and solve problems. The project also maintains an informational Web site—a good idea in a country where 96 percent of the population has Internet access.

Alcoa also is providing seedlings for more than 2,000 trees near the project site as part of its program to plant 10 million trees near Alcoa locations worldwide. Asmundur Asmundsson, chairman of the local forestry association, said that residents of Reyðarfjörður “are extremely pleased with Alcoa’s contribution to forestry in this community.”

Bechtel has worked on a number of Alcoa projects dating back more than 20 years, starting with the Portland aluminum smelter in Victoria, Australia, in 1984. “Good people build good projects,” says Warren McKenzie, Alcoa project director. “Here at Fjarðaál, we have focused on innovation and creativity as key drivers. By doing so, we have developed some firsts for the construction of aluminum smelters.

“We have encouraged this team to take a win-win approach on this project both internally and with vendors and suppliers,” says McKenzie. “The result of this philosophy is evident in the innovative solutions and everyday successes on the project.”

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