Israel Chemicals won't pay to save Dead Sea Hotels

Israel Chemicals: The cost of the removal of the salt in the southern basin is $760 million, and it's the government's responsibility.

Israel Chemicals Ltd. (TASE: ICL) agrees with the Israel Hotels Association and the Ministry of Environmental Protection: at a press conference, company executives said that the best solution to halt the rising the water level in the southern basin of Dead Sea is to fully harvest salt, which will endanger the hotels at Ein Bokek along the shore. However, the company refuses to pay for it.

Israel Chemicals agrees to the removal of the salt strata on the bottom of the 80-square kilometer Pool no. 5, the source of the company's operations, as well as the basis of tourism at Ein Bokek. 14 hotels line the shore. The accumulation of salt on the basin floor is pushing up the water level by 20 centimeters a year, threatening the hotels.

Israel Chemicals Fertilizer Division general manager Danny Chen said that the government is responsible for harvesting the salt and financing its removal. The company presented figures that the cost of the removal is $760 million, plus an annual operations cost of $100 million.

Israel Chemicals feels a sense of urgency on the matter, because Minister of Tourism Stas Misezhnikov plans to announce at the end of the month which of the three alternatives he will choose for dealing with the problem. The Hotels Association is afraid that he will agree with Ministry of Finance officials, who believe that moving the hotels is the cheapest alternative, and will boost the area's tourism and develop its infrastructures.

Environmental organizations and Minister of Environmental Protection Gilad Erdan support an alternative solution: to scrape off the salt strata in Pool no. 5 to increase its capacity and slow the rise in its water level, which has already reached the gates of the hotels.

A government official objects to the position of Israel Chemicals. He said, "As the party responsible for the problem created at the Dead Sea, Israel Chemicals' Dead Sea Works should bear the cost, if not in whole, at least in part. Don’t forget that the problem was created by the company's operations, and we all know how profitable they are."

The southern basin of the Dead Sea is sealed off from the northern basin, where the water level is falling rapidly, due to the reduction of the water flow from the Jordan River.

Published by Globes [online], Israel business news - - on January 25, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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