Iceland pours millions into second stage of Blue Lagoon makeover

Norman Miller reports on the Nordic country's bid to capitalise on a wonder of nature

Iceland's Blue Lagoon, the country's most photographed visitor attraction, is undergoing an extensive makeover which will put it at the forefront of the increasing tourism trade to the country.

Iceland's Blue Lagoon, the country's most photographed visitor attraction, is undergoing an extensive makeover which will put it at the forefront of the increasing tourism trade to the country.

The lagoon has long attracted bathers with its combination of geothermally heated water, health-giving minerals, white silica mud and the blue-green algae that make its 40C (105F) water bright blue. While Reykjavik and its nightlife has attracted much attention in recent years, Iceland's tourism industry has woken up to the potential of the Blue Lagoon and is grooming it to be one of the world's most coveted - and eccentric - visitor attractions.

The first phase of the lagoon's makeover, completed last year, added a new 5,000sq m bathing area and a sandy "beach", hi-tech changing facilities for 900 people, an enclosed geothermal spa and steam bath, silica mud pools, lava caves, an indoor pool, conference rooms, and a restaurant with 7m-high glass walls. Now the next stage is due, which will add a 100-bedroom hotel and a day spa. Both are planned to open in 2003.

"There is already a hotel but it is fairly small - it's more of a guesthouse," said Magnea Gumundsdottir of the Blue Lagoon. "We hope that we will be able to accommodate many more people with the new hotel." She adds that the lagoon has become the top single visitor attraction in Iceland, and that guest numbers have risen more than 100 per cent in two years, from 172,000 people in 1998 to 350,000 this year.

According to Icelandair, some 31,000 British tourists visited the country last year. More than 60 per cent of them visited the lagoon, and indications are that numbers have risen this year. "Almost everybody who goes to Iceland wants to see the Blue Lagoon," said a spokeswoman for tour operator Arctic Experience. "A lot of people seem to have heard of it already. Guests tend to stay there two or three hours but some people get really hooked on the place."

More than half of the tourists who visit Iceland now put a dip in the Blue Lagoon on their schedule. Celebrities who have visited it include Kevin Costner and Jerry Seinfeld, and it was featured in a famous photo-shoot of the Icelandic singer Bjork. As the Blue Lagoon is only 15 minutes away from Iceland's Keflavik international airport, it also gets visitors who are on stopovers.

It is also a special destination for sufferers of some skin disorders. In 1997 Iceland's health ministry made it an official out-patient clinic for skin treatments, as its waters are said to be beneficial to those who suffer from psoriasis and eczema.

International guests count for 60 per cent of the total number of visitors. The number of domestic guests has risen significantly, as last year they were 25 per cent of visitors."That is the fun thing about the Blue Lagoon," said Gumundsdottir. "The local population uses it as well, so it is not just a tourist thing but also a great place to see Icelandic people."