Interview series: Runolfur Maack, Mannvit Engineering

Mannvit Engineering, company website snapshot
Alexander Richter 19 Sep 2010

In an interview with Runolfur Maack, Deputy CEO for international operations of Icelandic engineering group Mannvit, he talks about his company's plans in the U.S. and the services the company offers internationally and in cooperation with Technip.

Having posted two interviews with individuals from North America, I am now very pleased to have the opportunity to present an interview with Runólfur Maack, the Deputy CEO of Icelandic Mannvit Engineering.

Mannvit Engineering is the largest engineering groups in Iceland with a long track record of working in the geothermal energy sector in Iceland and internationally. The company today has operations in Iceland, Germany, Hungary and Chile, but works in many other countries, among them the United States. ThinkGeoEnergy reported before on the cooperation of Mannvit with Technip on providing EPC services to the U.S. market.

Runólfur Maack is the Deputy CEO for Mannvit’s overseas operations, who has been engaged in geothermal development since 1975. He answers my questions on behalf of the company.

How would you describe your company and your key activities and markets?
Mannvit is an overall engineering consulting company mainly operating in the domestic market. Mannvit is the result of a recent merger of three engineering companies formed with the objective of making a strong company able to offer to the market total services and solutions in all disiplines of engineering. Being the largest engineerng company in Iceland with appr. 400 employees Mannvit has taken full part and responsibility in the green energy development in Iceland over the past decades. Thus Mannvit has gained unique experience which opens up opportunities in the international market, especially related to green energy such as hydro power projects and geothermal development projcets. As a result Mannvit is one of very few companies with extensive experience in all fields of geothermal project development.

What are the services you offer to companies in the U.S. and how do you see the opportunities for your company in the U.S.?
There will be increased geothermal activities in the US in the near future. There will be both newcomers and seasoned developers active in the market. To them, Mannvit can offer full services in geothermal development from the very early reserarch stage to the very end of an up and running power plant. Especially for the U.S. market, the reporting of resource capacities is important and Mannvit has today gained the status of a “qualified person” for the reporting after the Canadian Geothermal Reporting Code by CanGEA. Reporting under a certain code is important for listed companies and also for financial instituitions. It is also important for Mannvit to have a solid partner as to adopt all local laws and regulations so all engineering complies to US standards and codes. For this purpose Mannvit has entered into an alliance agreement with Technip, a provider of project management, engineering, and construction services.

What do you consider the key obstacles and challenges for increased development in the U.S.?
Usually good rate of return of an investment is the driving force for a successful project. The same applies for geothermal projects. A binary geothermal cycle in general costs a little too much to become price-competitive. Therefore some support is needed to make the geothermal projects price competitive. This can be in form of grants, tax benefits, carbon credit bonuses or higher prices for the green geothermal energy. The challenge is to make the price from geothermal energy projects more competitive in a similar manner as we have been able to do in the Icelandic market where we are offering among the lowest energy prices for industries in international comparison.

What do you think holds back speedier development of geothermal energy projects globally?
Referring to my answer earlier, especially the driving forces of a successful project, such as support in form of grants, tax benefits etc, but also incentives with regards to price-competitiveness. The opportunities in geothermal development are there. But we need to realise that the geothermal industry is a relatively small industry with very much so limitted skillfull resources when it comes to quantities. Also there are many newcomers in the market and this might lead to some mistakes which again could lead to some setback for the industry.

What are your expectations for the event in Sacramento?
To learn how the industry has developed so far and to evaluate the potential for the future. Also, it goes without saying to establish business relations for the future activities especially for the US market.