The company Syntholene Energy CORP (TSXV: ESAF, FSE: 3DD0, OTCQB: SYNTF) has formalized a 500 m² land lease agreement at the Húsavík Power Station with the Municipality of Norðurþingi dated April 13th, 2026, and has also been granted a municipal construction permit on March 17, 2026. The site will host the firm’s first demonstration-scale thermally-integrated electrolyzer, referred to as the Demonstration Facility, designed to combine high-temperature geothermal heat with advanced electrolysis to produce synthetic aviation fuel. These two milestones anchor Syntholene’s operational presence in Iceland and enable immediate site preparation and modular installation work.
The Municipality of Norðurþingi, represented by Mayor Katrín Sigurjónsdóttir, voiced support for the project as aligned with local goals to use geothermal energy for sustainable industry. Syntholene’s CEO, Dan Sutton, emphasized the strategic benefits of the Húsavík location: close access to geothermal inputs, existing industrial infrastructure, and a capable local workforce. The company frames the initiative as a pathway to produce cost-competitive, low-carbon synthetic jet fuel while contributing to regional economic diversification. The demonstration aims to validate technology performance and pave the way for larger commercial deployments.
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Site advantages and technical integration
The Húsavík Power Station sits inside the town and beside a commercial port, providing immediate logistical benefits for modular components and equipment staging. The facility preserves significant geothermal infrastructure including heat-exchangers, active district-heating networks, water cooling systems, and a 20-km insulated pipeline from the Hveravellir geothermal field. Although the 2 MW Kalina power unit has been idle since 2010, its mechanical footprint remains intact and district heating is operational. These conditions are expected to lower civil works and reduce capital and schedule risk for Syntholene, facilitating the integration of the company’s Thermal Coupling and Solid Oxide Electrolyzer Cell (SOEC) systems into the existing thermal envelope.
Lease mechanics and permit constraints
Under the terms of the lease, which runs until April 1, 2027 unless renewed, Syntholene is responsible for maintaining the property and for compliance with applicable laws and permits. The lease carries a monthly rental fee of ISK 200,000 (approximately CAD$2,525) and requires the Lessor’s consent before erecting structures beyond approved site plans. The construction permit granted on March 17, 2026 is effective until the end of March 2027 and is contingent upon any further approvals from the Lessor. Subject to conditions, the permit authorizes on-site preparation and the assembly of a modular, containerized demonstration system that couples geothermal heat exchange with SOEC electrolysis for hydrogen and fuel synthesis.
Regional energy context and expansion potential
Húsavík and the surrounding Norðurþing municipality have a well-established record hosting energy-intensive industries such as silicon processing, seafood processing, greenhouse agriculture, and municipal heating. National and local plans (Sóknaráætlun Norðurlands eystra) prioritize North Iceland for diversification into next-generation industrial anchors. The nearby Þeistareykir high-temperature geothermal field already supports a 90 MW station, and a 2015 Environmental Impact Assessment cleared the site for up to 200 MW of production. With Landsvirkjun signaling investment in transmission upgrades and new substations, the region is positioning itself to supply substantial, renewable baseload power to projects like clean fuel synthesis and hydrogen production.
Logistics and connectivity
Beyond geothermal resources, Húsavík benefits from a deep-water port, two nearby airports (Húsavík Regional and Akureyri International), and local logistics that simplify modular imports and potential fuel exports. These assets support Syntholene’s plan to run a targeted ~1,000-hour effects test as part of the Demonstration Facility program, gathering operational data to optimize engineering designs, demonstrate safety and environmental controls, and chart regulatory and commercial pathways for scaling the technology.
Partners, objectives and next steps
Syntholene has engaged Icelandic engineering firm HD ehf. (HD IS) as the general contractor for early site works, civil coordination, and the implementation of a comprehensive Health, Safety, and Environmental (HSE) framework tailored to hydrogen-integrated operations. HD IS will manage subcontractors and regulatory engagement while preparing the site for system assembly; CEO Árni Rafn Gíslason expressed pride in partnering on a project that supports Iceland’s energy transition. Separately, the previously announced non-binding letter of intent with North Tech Energy has concluded and expired, leaving Syntholene free to pursue its geothermal strategy independently.
Looking ahead, Syntholene intends to execute its demonstration testing within the permit window, collect performance and materials data, and use results to inform commercialization plans for ultra-pure synthetic jet fuel that the firm says targets significantly lower cost than competing technologies. While the company highlights strong municipal cooperation and regional energy expansion as important enablers, it also notes that activities described are subject to regulatory conditions, operational risks and other uncertainties typical of early-stage demonstration projects.