History of HRV

The beginnings of HRV

The roots of HRV Engineering are closely connected to Norðurál and Grundartangi, yet in order to produce a clearer overview of the company and its establishment one must look over a wider range of factors. HRV was founded in 1996.

A partnership for Norðurál

In August of 1996, a decision for a planned partnership for Norðurál was informally ratified and technical staff from Hönnun, Rafhönnun and VST immediately began to prepare for an aluminum plant at Grundartangi from Columbia Ventures (CV) under the name of a company which was not formally established until the 30 November, 1996. The owners of CV directly contributed to the partnership of the engineering firm but at the time, nothing beyond the construction projects at Grundartangi was foreseen as such coalitions are generally part of due procedure for such large-scale endeavours.

The representative for HRV

Sigurður St. Arnalds represented HRV JV from its formation in 1996 until 2003.

A Joint Venture (JV)

The declaration for the coalition (JV) of the companies comprising HRV was signed in March of 1997 and is now regarded as its founding document. The officiators were Sigurður St. Arnalds (who also acted as project manager) representing Hönnun, Viðar Ólafsson from VST and Daði Ágústsson from Rafhönnun.

Digging the ground at Grundartangi

The first shovels to break the ground for the aluminum plantr at Grundartangi commenced on the Saturday of Easter weekend on the 29 March 1997 and then, in June of 1998, the first pot was put into motion. At the time, the plant employed 160 workers and production capabilities were at 60.000 tonnes per year.

The development of HRV

In the first phase of the Grundartangi project in 1997, the HRV staff regarded themselves first and foremost as employees of Hönnun, Rafhönnun and VST under the “umbrella” of HRV.

Norsk Hydro considers building an aluminium plant

When Norsk Hydro began to explore the possibility of constructing an aluminum plant at Reyðarfjörður late in 1997, the company held a competition for Icelandic engineering firms to provide the necessary technical support. The owners of HRV decided then to continue their partnership into a new field and became the frontrunners in the competition. The preparatory work by Norsk Hydro continued for a few years until the company then withdrew from the project in 2002.

HRV in continuous development and the company image

In the second phase of the Grundartangi project it was decided to improve upon HRV’s company image by (amongst other things) imprinting the company logo on the helmets.

Sigurður St. Arnalds on K Home and the partner companies

Sigurður St. Arnalds brought special attention to KHome and the partnership of Hönnun, Rafhönnun and VST in the Norðurál project in an interview in Morgunblaðið on the 17^th of July 1997: “K Home Engineering is finishing up a corresponding project in Dubai in the United Arab Emirates. Therefore, they have extensive experience in such affairs and bring to the partnership expert technical knowledge in various specialized projects and in the arrangement of equipment which is where we lack experience… With this, we are furnished with the opportunity to train a fairly large group of workers in an area where Icelandic engineers usually receive very little exposure. I think it’s then crucial that the various parties will have the chance to co-operate on such a level and this no less with future domestic and foreign projects in mind. This project builds upon their versatility and furnishes them with valuable experience.”

The aluminum plant at Reyðarfjörður further solidified the bonds

Norðurál’s construction projects at Grundartangi fostered the establishment of HRV yet it was the planning of the plant at Reyðarfjörður which fully realized the partnership of Hönnun, Rafhönnun and VST.

A plant at Grundartangi designed and built in record time

The plant at Grundartangi was designed, built and commenced operations, in 14 months. Such results had never been seen before in the aluminum industry and it was likened to a miracle. This was due in no small part to the successful partnerships of those involved, KHome, HRV and the coalition of the three engineering firms comprising HRV. This meant that the Icelandic engineers were also able to prove their competence.

In partnership with Bechtel

The owners of HRV decided upon a partnership with one of the largest engineering firms in the world, Bechtel, as it would likely prove strongest in the competition for the project on the eastern shore. HRV sent an officer west to North America to take part in Bechtel’s promotional discussions with Alcoa at an auction for the project among North American corporations which ended with Alcoa negotiating with Bechtel. HRV became a subcontractor for Bechtel in design and construction promoting their status in the project and thus calling upon all associated documents to be labelled “Bechtel in association with HRV”.

The contracts over Kárahnjúkar

In March of 2003, the contracts for the Kárahnjúkar developments and the Alcoa aluminum plant were signed in the Reyðarfjörður sports hall. This perked the interest of the HRV associates, especially since familiarizing themselves with aluminum plant plots following the years of service to Norsk Hydro.

The partnership of HRV and Alcoa Fjarðarál

HRV’s implication in the works conducted under Alcoa Fjarðarál were to take the company’s level of knowledge and experience up a notch and this, before yet another step up when the company took over the management of  the ISAL Production Upgrade project of Rio Tinto Alcan in Straumsvík.

Ambassadors to Canada

Þorkell Erlingsson from VST travelled to Montreal, Canada under the auspices of HRV as its Director of Design for the Reyðarfjörður aluminum plant, and lived there from 2003 until 2005. Other employees of HRV were also in Montreal for shorter, as well as longer term stays, for the same purpose.

HRV in the Firm Registry

HRV sf. was founded in 2003 and formally annexed into the Firm Registry  with the Reykjavík Ombudsman on the 3 Nov. With this, it was decided to take the step into dividing the HRV partnership under triple ownership. Hönnun and VST each acquired a 36% share in HRV sf., while Rafhönnun assumed the remaining 28%.

Executive Director of HRV sf

Eyjólfur Árni Rafnsson was the Executive Director for HRV sf. from 2003 until 2007.

The signing of the contract with Bechtel

The final negotiations for the Bechtel partnership were signed into contract on the 12 June 2003. Up until then, Sigurður St. Arnalds had been the main representative for the group but now he was succeeded by a formalized Board of Directors and an Executive Director, Eyjólfur Árni Rafnsson.

The HRV Board

The first HRV sf. Board of Directors was comprised of Örn Steinar Sigurðsson from VST, Eyjólfur Árni Rafnsson (Chairman) from Hönnun and Skapti Valsson from Rafhönnun.

Birgir Karlsson, Project Manager

In the third phase of Grundartangi, Birgir Karlsson as project manager emphasized that his employees worked for HRV and expected that they presented themselves as such. He was also the project manager in the fourth phase and oversaw the preparation for another aluminum plant at Helguvík also under the auspices of HRV.

The HRV Mission

The HRV sf. Board of Directors convened for an important meeting at Grand Hotel in Reykjavík on the 14 Nov. 2005 to discuss the company owners’ vision and aim. Representing Hönnun were; Eyjólfur Árni Rafnsson, Birgir Karlsson, Friðberg Stefánsson, Sigurður St. Arnalds and Haukur Einarsson. Representing VST were; Viðar Ólafsson, Örn Steinar Sigurðsson, Þorkell Erlingsson, Gunnar Guðni Tómasson and Níels Guðmundsson. Representing Rafhönnun were; Skapti Valsson, Þröstur Helgason, Júlíus Jóhanneson, Jóhann Þór Magnússon and Sigurður Sigurjónsson.

An “accordion” company

It was contemplated whether or not they should conduct HRV as an “accordion company”, which would entail increasing or decreasing size in accordance with each individual project: “We must try to secure some kind of consistency but it is clear that HRV strengths right now are lie precisely in its adaptability.”

The largest foreign endeavour for HRV since its beginnings (RUSAL Sundsvall)

HRV’s largest foreign endeavour was the restoration of an aluminum plant in Sundsvall in Sweden from 2006-2008. This company is now under the ownership of aluminum giant RUSAL but previously, there had been ownership links between the Swedish aluminum plant and Norðurál through Century Aluminium which had bought Norðurál from Columbia Ventures.

The RUSAL project

HRV directed the project in Sundsvall, organized design and practical endeavours. The main issue was to modernize their activities by discontinuing the use of so-called Söderberg devices and implementing the use pre-baked anode devices, as was already common practice in virtual all aluminum plants in Iceland. PB anodes are baked before they are placed into a closed pot  as oppose to the Söderberg anodes which are baked in open pots.

Project managers in Sundsvall and HRV’s contribution to the endeavour 

The project managers from HRV were Birgir Karlsson and later, Eggert V. Valmundsson. The contributions made by the company to the endeavour amounted to the equivalent of 40 years of manual labour.

HRV Strategic Planning

Much work was put into a policy development for HRV sf. in 2006 in conjunction with two advisors  from Capacent. One of them, Símon Þorleifsson, later became an HRV employee and is now in the Executive Planning Committee as Executive Director of HRV Engineering Alliance (Department of Operations and Maintenance).

New home for HRV

Late in 2006, the HRV sf. Board of Directors approved the rental of a 300 sq. metre office space at Grensásvegur 50 and a contract to this regard was signed on the 13 Nov.

HRV’s first employee

In December 2006, HRV hired its first employee Þorsteinn Guðbjörnsson. He was charged with the managing of accounts and project listing for HRV. Furthermore, he directed the purchasing of equipment and devices for all planned activities at Grensásvegur 50 and prepared for the move there.

A Chief Executive Officer appointed

Parallel to the organizational changes, a new CEO for HRV was appointed in Kolbeinn Björnsson at the beginning of 2007.

More strategic planning

HRV´s CEO had Capacent review the goals in their policy development planning from 2006 and then, on the 20 August 2007, just few days before HRV moved from Grensásvegur 50 to Bíldshöfði 9A, the Board approved new goals for the next three years:

• Income from 2011 shall amount to 6 billion ISK
• There shall be 300 employees in the auluminum department and 40-50 employees in the maintenance department
• HRV shall become a leading advisor in the aluminum industry on a worldwide-scale

HRV’s move to Bíldshöfði

At first, it was planned to move to Bíldshöfði in two phases but ultimately it ended that they waited until the building were fully-equipped before moving in. This was completed in September 2007. The bottom floor was dedicated towards the preparatory work for a new aluminum plant in Helguvík (Project Office), while other projects and the general administration of the company HRV were executed on the top floor.

The economic collapse

HRV’s business endeavours decreased somewhat following Iceland’s economic collapse in the Fall of 2008. Early in 2009, management of the company had been downsized to two-thirds. Kolbeinn Björnsson resigned as CEO and was succeeded by Skapti Valsson, an HRV Boardmember since beginning.

Environmental Impact Assessment at Bakki

HRV conducted the EIA for the aluminum plant at Bakki in Húsavík for Alcoa and was also responsible for various technical preparations in regards to the plot and proposed aluminum plant there.

Significant signs of recovery in HRV’s work environment

The company’s projects began to pick up their pace anew in 2010 and there were also signs of this in management and the company’s housing issues.

IPU: HRV’s largest endeavour comes on its 15^th anniversary

HRV’s largest endeavour to date came on its 15^th anniversary and involves the renewal, development and improvement of equipment and production processes at the Rio Tinto Alcan aluminum plant at Straumsvík and increase production by 20%.

The price tag on the IPU project

The cost for this investment venture is overall estimated at 450-500 million usd according to the plants website. It should be noted that in comparison the overall costs for the Búðarháls power plant were projected to be 216 million usd when the first  components were called out in February 2010. The construction projects in Straumsvík are of such a grand scale that much vigour is imbued into the economy. An overwhelming portion of the work is in Iceland hands and it is predicted that more than a third of the profits will stay in Iceland as pure net currency.

High standards in the IPU project

There is much responsibility connected to the ISAL Production Upgrade  project which tests and challenges significantly on the infrastructure and employees of HRV. Within HRV, it is thus assumed that working conditions in this specific project are quite far from the “cotton/protected environment”  of traditional projects at engineering firms in comparison to other ventures to which the company was committed.

Projects in good standing for the 15^th anniversary

HRV is connected to the maintenance and renewal to various degrees of virtually all aluminum plants in Iceland. Two of the most prolific on the 15^th anniversary in 2011 are with Alcoa Fjarðaál.

New electrical rectifier at Fjárðaál

Work is in progress for a large project in the electrical system of the aluminum plant following explosions/fires in a rectifier of a substation shortly before Christmas 2010. A new rectifier has replaced the burnt one and a secondary rectifier has also been added to increase security, as well as prepare for a possible expansion/production increase at the plant.

New  Potroom at Fjarðaál

Works are in progress to develop a new potroom at the plant. This is an investment in a building worth billions of ISK which is planned to house a pot insulator, cleaning facilities, pot demolition, and office maintenance. The Canadian engineering and consulting firm Hatch is managing this project for Alcoa Fjarðaál in collaboration with HRV.

The preparations in Helguvík

HRV is now responsible for an extensive project related to the preparations and constructions for an aluminum plant from Norðurál in Helguvík at Suðurnes. The company conducted an environmental impact assessment and directly manages construction, as well as monitors procurements and project management.

A new CEO

Gunnar Guðni Tómasson, who had already worked for HRV and sat on the Board, was appointed the CEO in the summer of 2011. He assumed the position on the 1 September.

Expansion of the Project Office

Around the same time, the 8^th floor at Bíldshöfði 9A was put into use and committed to the tasks related to HRV’s largest project to date, the current amplification at Straumsvík (“the IPU project”). With this, HRV’s headquarters occupy about 2 000 sq. metres, on three floors at Bíldshöfði.

Turnover and workforce

It is expected that HRV’s net annual income will be approximately 49 million usd and the employee workforce is tallied up to around 300 in projects in every aluminum plant in Iceland.

Iceland’s largest engineering firm

HRV has grown rapidly and has already doubled its turnover following the economic collapse. Further, the company achieved the milestone of becoming the largest engineering firm in Iceland at the beginning of 2011 if based on turnover. HRV has acquired many large-scale projects in the country which no other engineering firm could have tackled. The company’s activities create jobs and provide valuable currency for the national coffers and economy.

Iceland now benefits from extensive expert knowledge and specialized experience in the aluminum industry due to HRV’s endeavours and the company is at the forefront at co-ordinating design, contract negotiation, procurements and construction planning ( EPCM Contract).