Approval for conversion of development licenses for the Ocean Farm 1 project

SalMar’s subsidiary Ocean Farming AS has been granted its eight development licenses converted into ordinary fish production licenses. The Norwegian Directorate of Fisheries informed the company of its decision in a letter dated 7^th of July 2020.

This means that the eight licenses the company was granted on 26 February 2016 for the realization of its offshore fish farming facility (Ocean Farm 1) can now be included in its ordinary production, within the framework and regulations governing maximum allowable biomass (MAB).

In its decision, the Directorate of Fisheries points out that Ocean Farming has provided comprehensive and thourough documentation showing that the performance criteria and thus the conditions for conversion have been fulfilled. The experience gained through the project has been described and reported to the Directorate of Fisheries, most recently in the form of a final report and a separate report on the development of the project in the first half of 2020. These reports are publicly available. In this way, the knowledge deriving from the project will benefit the entire aquaculture sector, as required by the regulations underpinning the development license scheme.

SalMar is proud that we have completed a project that we believe to be a groundbreaking step towards the development of an even more sustainable aquaculture sector. The project was founded on a unique, interdisciplinary partnership between Norwegian and international organizations at the forefront of aquaculture production, offshore technology, and relevant scientific research. By completing this project, SalMar has contributed to the realization of the public authorities’ objectives for the development license scheme, namely, to resolve important environmental and spatial challenges affecting the industry. SalMar has now invested approx. NOK 1 billion in the design and development of Ocean Farm 1, with over 50 per cent of this amount spent on services and equipment from Norwegian knowledge companies. The Ocean Farm project would have been impossible to realize without the development license scheme, which the government introduced in 2015 and which has had broad cross-party support in the Norwegian parliament. In this way, the Norwegian authorities, together with the industry, have triggered technological breakthroughs that will strengthen Norway's position as a leader in new technology that can contribute to sustainable growth in the aquaculture industry.

Conversion of these licenses will not affect the operation of Ocean Farm 1, which is currently approaching the end of its second production cycle. The positive operational experiences gained during the first two productions cycles will pave the way for Ocean Farm 1 to become an important production unit in SalMar’s overall fish farming operations going forward. SalMar has already launched a project to investigate the financial and technical conditions necessary to build additional units with a similar design to Ocean Farm 1 for deployment in more exposed positions within the area of application of the Norwegian Planning and Building Act. Our experiences from Ocean Farm 1 reinforce SalMar’s firm belief in offshore farming.

Gustav Witzøe
CEO SalMar ASA

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.