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Lease Anchors Company's Icelandic Operations With Access to Regional Geothermal Infrastructure, Industrial Workforce, and Major Grid Expansion Initiatives
Syntholene Energy CORP (TSXV: ESAF) (FSE: 3DD0) (OTCQB: SYNTF) ("Syntholene" or the "Company") announces that it has entered into a definitive Land Lease Agreement (the "Lease Agreement") dated April 13th, 2026, with the Municipality of Norðurþingi ("the Lessor") in respect of a 500 m² site (the "Property") at the Húsavík Power Station as the Company's first Icelandic site. The Company plans to use the Property as the location for its first demonstration-scale thermally-integrated electrolyzer (the "Demonstration Facility"). Syntholene is also pleased to announce that it has received municipal approval for its construction permit in Húsavík, Iceland, marking a key regulatory milestone in the advancement of its Demonstration Facility.
Húsavík Power Station looking on to Skjálfandi Bay
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Katrín Sigurjónsdóttir, Mayor of Norðurþing, stated, "The municipality of Norðurþing, owner of Húsavík Energy, is proud to support the development of Syntholene through its Demonstration Facility for non-fossil aviation fuel. Syntholene's goals of the sensible use of geothermal energy to produce cost effective and environmentally friendly synthetic fuel for the benefit of society, align with the goals of the municipality of Norðurþing. We look forward to supporting this initiative to make possible the expansion of the project and meet domestic demand for aviation fuel."
"This lease and permit represents a transformational step in establishing Syntholene's Icelandic footprint," said Dan Sutton, CEO of Syntholene. "The site at Húsavík Power Station offers an exceptional combination of geothermal availability, infrastructure, workforce readiness, and political alignment. It provides a strategic launch point for our first Demonstration Facility while offering Syntholene a pathway to scale in one of the most geothermally abundant regions on Earth."
"We are honoured to work with the community of Húsavík and its leadership at a time when new industrial diversification is desired by the community," Sutton added. "Syntholene aspires to help build long-term economic diversification in the region, while advancing our mission to deliver ultra-pure, cost-competitive synthetic fuels."
The Lease Agreement and the Húsavík Power Station
Located inside the town of Húsavík and adjacent to a commercial port, the Húsavík Power Station represents a preserved geothermal energy center, including heat-exchangers, district-heating ties, water cooling systems, and a 20-km insulated geothermal pipeline from the Hveravellir geothermal field in Reykjahverfi.
Although the 2 MW Kalina power unit has not produced electricity since 2010, the facility was not dismantled, its district-heating systems remain active and its core mechanical systems remain intact. Such attributes are expected to reduce early-stage civil works, reduce schedule risk, and lower capital requirements compared to other comparable development sites, and enable Syntholene to integrate its high-temperature Thermal Coupling and Solid Oxide Electrolyzer Cell (SOEC) demonstration system into an existing thermal footprint.
The Lease Agreement will remain in effect until April 1, 2027, unless renewed by the parties or earlier terminated in accordance with its terms. Under the terms of the Lease Agreement the Company is responsible for maintaining the Property, ensuring that all activities comply with applicable laws and regulatory requirements and that all necessary permits are obtained and maintained. A rental fee of ISK 200,000 (approximately CAD$2,525) per month is payable during the term of the lease, and additional fees may be payable for use of certain facilities. The Lease Agreement provides that the Company is required to obtain the Lessor's consent prior to constructing any buildings or structures other than those specifically contemplated in the approved site plans on the Property.
Construction Permit Issued
The local planning and development authority of Norðurþing Municipality granted the Company a construction permit with respect to the Property at its March 17, 2026 meeting.
The permit is effective until the end of March 2027 and is subject to the planning and development authority receiving approval from the Lessor. Subject to the conditions of grant being satisfied, this approval enables Syntholene to proceed with on-site preparation and construction activities, including the deployment of its modular, containerized Demonstration Facility integrating geothermal heat exchange and solid oxide electrolysis systems. The permitting process included coordination with local authorities to ensure alignment with land use planning, environmental considerations, and safety requirements associated with hydrogen-integrated industrial operations.
The time-bound nature of the permit reflects the Demonstration Facility's classification as a temporary scientific and industrial demonstration, designed to validate system performance under real-world operating conditions. During the permitted period, the Company intends to execute its ~1,000-hour effects test operational program, with a view to generating critical data to support engineering optimization, inform regulatory pathways, and validate commercial scale-up.
Receipt of the permit represents achievement of a significant milestone and further evidence of the strong support and cooperation of the Norðurþing Municipality as Syntholene advances its presence in the region.
About Húsavík and Norðurþingi: A Region Positioned for Long-Term Expansion
Húsavík has a decades-long history of hosting large-scale industrial energy users, including silicon processing, shrimp processing, greenhouse operations, fish farming, and municipal heating infrastructure. The municipality of Norðurþing and the Government of Iceland have prioritized North Iceland for diversification and new industrial anchors (Sóknaráætlun Norðurlands eystra), creating uniquely aligned political, workforce, and infrastructure environments for Syntholene's Demonstration Facility.
The area surrounding Húsavík is one of Iceland's most capable geothermal corridors. The Demonstration Facility intends to draw on the existing Hveravellir geothermal resource for thermal integration, and the Þeistareykir high-temperature geothermal field represents an opportunity for potential long-term commercial expansion enabled by the Þeistareykir high-temperature geothermal field, with an operational 90 MW geothermal power station environmentally assessed for up to 200 MW of expanded production capacity (Landsvirkjun).
Landsvirkjun, Iceland's national power company, also recently confirmed major investment plans for North Iceland's transmission system including new substations and 132 kV line expansions (RUV), to attract next-generation industrial customers such as clean fuels and hydrogen.
The expansion ambitions for the Þeistareykir geothermal field represent the cornerstone of Iceland's transition toward next-generation industrial applications. While the power station currently operates at a capacity of 90 MW, consisting of two 45 MW units commissioned in 2017 and 2018, the power station was designed with significantly higher long-term potential (Lansvirkjun).
According to the 2015 Environmental Impact Assessment (EIA) overseen by the National Planning Agency, the site is environmentally cleared for a total production capacity of up to 200 MW (EIB). This expansion is supported by extensive reservoir modelling. Landsvirkjun's 2026 investment cycle prioritizes the utilization of this additional 110 MW to support energy-intensive industrial sectors (Lansvirkjun).
By leveraging the Þeistareykir field's high-temperature steam, the expansion aims to provide the stable, renewable baseload power required for emerging industrial operations such as clean fuel synthesis, hydrogen production, and the diversification of the North Iceland geothermal corridor.
Húsavík also benefits from its deep-water port access, two airports (Húsavík Regional and Akureyri International), and existing logistics infrastructure that support modular imports, equipment staging, and future exports of synthetic fuels to domestic and international markets.
HD IS Appointed as General Contractor
Syntholene Energy Corp. also announces that it has appointed HD ehf. ("HD IS"), a leading Icelandic engineering and construction services firm, as General Contractor for the Company's Demonstration Facility in Húsavík, Iceland. The appointment represents a critical step in advancing the Company's development timeline by establishing a locally anchored execution partner with direct experience in Icelandic infrastructure delivery, regulatory coordination, and industrial project management.
Under the terms of the agreement, HD IS will act as General Contractor for early-phase site execution activities, including overall project coordination, subcontractor management across civil, mechanical, and electrical scopes, and day-to-day site supervision. The mandate also includes the development and implementation of a comprehensive Health, Safety, and Environmental (HSE) framework tailored to a hydrogen-integrated demonstration environment, incorporating permit-to-work systems, lifting and hot works controls, interface management, and incident reporting protocols.
In parallel, HD IS will support permitting workflows and regulatory engagement with local Icelandic authorities, maintaining compliance tracking systems and identifying all outstanding requirements ahead of commissioning.
The engagement of HD IS reinforces Syntholene's strategy of partnering with experienced, regionally embedded contractors to reduce project execution risk and accelerate project timelines. With established capabilities in Icelandic project delivery and familiarity with local regulatory frameworks, HD IS is expected to play a central role in bridging engineering design, site readiness, and targeted construction phases as the Company progresses toward commissioning.
The appointment of HD IS builds on Syntholene's broader development efforts in Húsavík and aims to position the Company to advance its demonstration program with a coordinated, safety-focused, and execution-driven approach, laying the groundwork for future scale-up of its synthetic fuel production platform.
"We are very proud to have been selected as a partner by Syntholene Energy for this ambitious project in Húsavík," stated Árni Rafn Gíslason, CEO of HD IS. "It is particularly exciting to be part of a project focused on innovation and the development of sustainable energy solutions. This project aligns well with our core strengths and our vision of building and operating infrastructure that supports the energy transition and the development of future industries in Iceland."
About HD
HD ehf. is one of Iceland's largest and most established industrial and technical service companies, and a leader in metal engineering, mechanical services, steel fabrication, and technical solutions. The company serves key sectors of the Icelandic economy, including fisheries, aquaculture, energy, heavy industry, and environmentally related operations, delivering specialized and reliable solutions nationwide.
HD also operates Iceland's only turbine workshop, providing maintenance services for geothermal turbines and generators. Today, the company employs over 200 people across five locations, combining extensive expertise and technical know-how to ensure safety, reliability, and efficiency in its clients' operations.
Culmination of NTE LOI
Syntholene confirms that the principal activities contemplated under its previously announced letter of intent with North Tech Energy have now been completed, and the letter of intent has expired in accordance with its terms. The letter of intent was non-binding in nature, other than certain customary provisions, including confidentiality. Syntholene retains full strategic flexibility in its geothermal development activities and is not subject to any ongoing obligations under the expired letter of intent.
About Syntholene
Syntholene is actively commercializing a new production pathway for low-cost clean fuel synthesis. The target output is ultrapure synthetic jet fuel, manufactured at 70% lower cost than the nearest competing technology. The company's mission is to deliver the world's first truly high-performance, low-cost, and carbon-neutral synthetic fuel at an industrial scale.
Founded by experienced operators across advanced energy infrastructure, nuclear technology, low-emissions steel refining, process engineering, and capital markets, Syntholene aims to be the first team to deliver a scalable modular production platform for cost-competitive synthetic fuel, thus accelerating the commercialization of carbon-neutral eFuels across global markets.
For further information, please contact:
Dan Sutton, CEO
comms@syntholene.com
www.syntholene.com
Investor Relations
KIN Communications Inc.
604-684-6730
ESAF@kincommunications.com
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "aims", "continue", "estimate", "objective", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. All statements, other than statements of historical fact, including but not limited to statements regarding the Property, the proposed Demonstration Facility, testing planned at the proposed Demonstration Facility and the proposed use of data from such testing, commercial scalability, the political, workforce, and infrastructure environments resulting from governmental and private sector priorities, potentials of the Húsavík and Norðurþingi regions, proposed benefits to the project form the skills of engaged service providers, including HD IS, the satisfaction of conditions of the construction permit, the Company's ability to execute on its plans for advancement and commercialization of its technology, technical and economic viability, anticipated geothermal power availability, anticipated benefit of eFuel, future commercial opportunities, are forward-looking statements.
The forward-looking statements and information are based on certain key expectations and assumptions made by the Company including without limitation the assumption that the Company will be able to execute its business plan in the manner and timeline set forth in its public disclosure or at all, that the engaged service providers have the skills to advance the Company's business plans, that the Húsavík region will offer the expected benefits to support advancement of the Company's business plan, that the eFuel will have its expected benefits, that there will be market adoption, that the Company's review of the competitive landscape and that its understanding of being the world's first Company to have geothermal-SOEC integration remain accurate, that any potential competitors to the Company would not be able to develop or execute geothermal-SOEC integration as quickly or as well as the Company, that the Company will be able to produce the eFuel at competitive pricing in the range anticipated in this news release or at all, that the proposed validation testing will be able to be completed, and that the results from such tests will validate the Company's technology and support further commercialization, that geothermal heat will be available to the Company at the necessary levels, that the proposed Demonstration Facility will be completed as anticipated and on time and on budget, that the Company will continue to have access to skilled personnel with relevant experience, that regulatory requirements remain favourable for the Company, and that the Company will be able to access financing as needed to fund its business plan. Although the Company believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that they will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature, they involve inherent risks and uncertainties.
Actual results could differ materially from those currently anticipated due to a number of factors and risks, including, without limitation, Syntholene's ability to complete the testing, that the results of test will support continued commercialization of the Company's technology, that the engaged service providers do not have the necessary skills to and do not advance the Company's business plan, that there are competitors in geothermal-SOEC integration that are unknown to the Company, that the Company may not be able to produce eFuel at the targeted prices or at a price that is lower than potential competitors, that definitive commercial purchase orders for Syntholene's eFuel may not materialize, the Company's ability to meet production targets, realize projected economic benefits, overcome technical challenges, secure financing, maintain regulatory compliance, manage geopolitical risks, and successfully negotiate definitive terms. Syntholene does not undertake any obligation to update or revise these forward-looking statements, except as required by applicable securities laws.
Readers are advised to exercise caution and not to place undue reliance on these forward-looking statements.
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