The cabinet today approved the agreement between the Ministry of Finance and Israel Chemicals Ltd. (TASE: ICL) on the NIS 3.8 billion project to rehabilitate the Dead Sea, NIS 3 billion of which the company will finance, and the doubling of the company's royalties on potash sales to 10% above three million tons a year. Minister of Environmental Protection Gilad Erdan and Minister of Tourism Stas Misezhnikov voted against the agreement.
Minister of Finance Yuval Steinitz said, "This is a historic agreement that will correct a wrong of over 20 years. This is worthy social responsibility."
Erdan said in response, "I regret the decision, which is a missed historical opportunity. Israel Chemicals received a unique natural resource, from which its shareholders have made a fortune, while the government's take was very small. Today was a historic opportunity, when the negotiations began, to greatly increase the public's share, which I regret was not seized."
Erdan said that, despite his reservations about the deal, lobbying by the Ministry of Environmental Protection resulted in decisions that will greatly improve the future of the Dead Sea, as well as Israel Chemicals bearing the brunt of the cost of the salt harvesting, and the reopening of discussion on royalties on potash sales.
In six weeks, a team will submit recommendations for the use of the increased royalties, which will be paid into a designated fund that will finance environmental damage caused by industrial operations.
Labor Party chairwoman MK Shelly Yacimovich said in response, "The agreement that the Ministry of Finance signed with Israel Chemicals on royalties is a miserable agreement that leaves the public only the crumbs of the country's natural resources which belong to everyone.
The Society for the Protection of Nature in Israel said in response to the cabinet decision, "SPNI welcomes the approval of the full salt harvesting option. Environmentally, full salt harvesting is much better than all the other options proposed over the years, which is why it should be expedited, because any delay in implementation will cause further environmental degradation."
Published by Globes [online], Israel business news - www.globes-online.com - on January 1, 2012
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