 Vancouver’s Magma Energy Corp. (TSX:MXY) has responded publicly to a mounting campaign in Iceland to block the company’s purchase of an Icelandic geothermal energy producer.
In a release Wednesday morning, Magma said it is confident that the proposed deal is in accordance with the laws of Iceland and it intends to fully co-operate with the government. Icelandic recording star and actress Björk has been the public face of the campaign, which has seen politicians in that country resign in protest over the proposed sale of HS Orka to Magma. Fourteen thousand Icelanders have also signed a petition calling on the government to block the sale. Icelandic regulations prevent the country’s energy assets from being owned by companies outside of the European economic area. The Icelandic government is investigating whether Magma established a Swedish subsidiary in June 2009 with the sole intent of acquiring HS Orka. The government committee will also broadly review foreign investment in Icelandic energy companies. Björk held a press conference last week calling for a referendum on foreign ownership of Iceland’s energy resources, including geothermal, which powers much of the island nation. Some have suggested the nation’s response to Magma’s bid is a form of protectionism arising in the wake of Iceland’s economic collapse, which stemmed from its foray into international banking. Björk and Magma CEO Ross Beaty have been communicating publicly via letters published by the Reykjavík Grapevine. Magma’s share price range during the past week: between $1.10 and $1.14; 52-week high: $2.10; 52-week low: $1.00.
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