Sides only 4 agorot apart in Ashdod desalination dispute

The dispute has delayed construction of the Ashdod desalination plant for a year.

A difference of just NIS 0.04 per cubic meter of water separates Mekorot National Water Company and the Ministry of Finance, in their dispute over the planned Ashdod desalination plant, Mekorot chairman Alex Wiznitzer told the Knesset Finance Committee yesterday. He said that the company was prepared to lower the price of water from the Ashdod desalination plant to NIS 2.40 per cubic meter.

The inter-ministerial tenders committee for seawater desalination has been blocking construction of the Ashdod desalination plant since Mekorot rejected its demand to price the water at NIS 2.36 per cubic meter. The cabinet is scheduled to discuss at its next meeting a proposal by Prime Minister's Office director general Eyal Gabai to cancel Mekorot's franchise for the plant and to publish a new international tender for it.

Prime Minister Benjamin Netanyahu appointed Gabai to find a solution to the dispute, which has delayed construction of the Ashdod desalination plant for a year. The 100-million cubic meter facility is intended to supply drinking water for one million people, and was supposed to begin operations by the end of 2012.

Tender committee chairman Deputy Accountant General Gil Shabtai told the Finance Committee that the difference between the price proposed by Mekorot and the ministry's position amounted to hundreds of millions of shekels over the 25-year franchise period.

Wiznitzer accused Shabtai of presenting the Finance Committee with incorrect figures. After the meeting, Wiznitzer sent a letter to Finance Committee chairman MK Moshe Gafni (United Torah Judaism) with detailed calculations of the differential. He said that a difference of NIS 0.04 per cubic meter amounted to NIS 33 million capitalized over the franchise period.

Wiznitzer said that even if the price difference were NIS 0.10 per cubic meter, as the Ministry of Finance claims, the total difference between the prices does not exceed NIS 80 million capitalized over the 25-year franchise period.

Published by Globes [online], Israel business news - www.globes-online.com - on January 27, 2011

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

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