Contractors dig deep for Andfjord Salmon

Work to excavate pits for 12 flow-through salmon pools at Andfjord Salmon’s 40,000-tonnes-per-year land-based farm in Norway is ahead of schedule, the company said in a report for the third quarter of 2023 today.

“The plan was to complete excavation of the 12 next pool pits by the end of the second quarter 2024. Right now, it looks like we will finalise this work during the first quarter next year - a great start to our build-out at Kvalnes,” said chief executive Martin Rasmussen.

As of today, the pool pit excavation workstream has reached 80% completion, up from 35% at the end of August.

Andfjord Salmon said that during the first quarter next year, contractors will be ready to initiate construction of the first four pools, which will increase the company’s production volume to 8,000 tonnes (head on gutted) in 2025. The company is targeting a total production capacity of 40,000 tonnes (HOG) at Kvalnes on the island of Andøya through a gradual volume increase between 2025 and 2030.

The company is also developing major shared infrastructure, such as waterways and harbour area, that will support future production at Kvalnes. Rock excavated from pool pits and waterways is being used in the development of a new harbour at Kvalnes, which Andfjord Salmon says considerably reduces operating costs and CO₂ emissions associated with the build-out.

The excavated material will be used to develop a quay and a breakwater. As of today, this workstream stands at 20% completion, driven by good progress from pool pit excavation. The inlet and outlet waterways workstream is 5% complete, up from 1% at the end of August.

“Progress ahead of schedule in the early stages provides added flexibility for the subsequent workstreams. It de-risks the build-out and reduces the probability of unwanted cost overruns. The construction performance so far is highly encouraging,” said Rasmussen.

Early in Q3, Andfjord Salmon completed its inaugural harvest of salmon from its proof-of-concept pool at Kvalnes with strong results, including a survival rate of 97.5% and superior share of 91.1%. The total biomass of Atlantic salmon reached 646 tonnes, equivalent to approximately 530 tonnes HOG.

Following the first harvest and subsequent sale of the fish, Andfjord Salmon delivered operating income of NOK 27.7 million (£2.04m) in Q3, up from zero in the same quarter last year. The company had an operating loss of NOK 28.2m in the third quarter, versus a loss of NOK 17.6m in the corresponding period in 2022. In total, Andfjord Salmon’s first harvest generated revenue of NOK 37.3m.