Israel Corp. accepts Treasury's Dead Sea terms

ICL will pay NIS 3.04 billion for the rehabilitation of the Dead Sea, as well as all cost overruns on the project.

By GLOBES
December 28, 2011 11:02
1 minute read.
Dead Sea

Dead Sea 311. (photo credit: (Marc Israel Sellem/The Jerusalem Post))

 
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Israel Corporation has accepted the Ministry of Finance's terms for the rehabilitation of the Dead Sea. Israel Corp. subsidiary Israel Chemicals Ltd. (ICL) will pay NIS 3.04 billion for the salt harvesting in the southern basin of the Dead Sea.

Israel Corp. chairman Amir Elstein and Finance Minister Yuval Steinitz signed the agreement Tuesday night on the financing of the salt harvesting and the higher royalties that will be paid to the state on Israel Chemicals' potash sales.

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Steinitz's deadline for Israel Corp. and Israel Chemicals to accept the Ministry of Finance's proposal on these issues expired last night. Under the proposal, Israel Chemicals will pay 90% of the cost of the salt harvesting and the government will pay 10%, and royalties on potash sales will double to 10% exceeding NIS 3 billion a year.

Israel Chemicals unit, ICL Fertilizers (formerly Dead Sea Works) will pay NIS 3.04 billion for the salt harvesting, and the government will pay NIS 760 million. NIS 337 million of the government's share is the current value of a NIS 30 million dividend withdrawn by the government in 1992 to finance protection of the Dead Sea. ICL Fertilizers will also carry out the Dead Sea rehabilitation work. If the project overruns its estimated NIS 3.8 billion cost, the company will bear the additional cost.

The agreement will now be sent to the cabinet and then to the boards of directors of Israel Chemicals and Israel Corp.

The government will not intervene in the planning of the salt harvesting project, except to "direct the planning parties to make every effort to expedite the work."

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