All Parties Sign on Ashkelon Power Plant

The financing agreement for a new private power station in Ashkelon was signed yesterday by a Finance Ministry representative, IPP Delek Ashkelon of the Delek fuel group, which will build the plant, and Bank Leumi.

Leumi will provide 75 percent of the money for the 80 megawatt power station of which 56 MW will fire desalination plant at the same site and the rest to be sold to private consumers. The power station will be gas-fired, with gas supplied by Tethys Sea from its natural gas reserves off the coast.

Equipment for the plant is to be supplied by Siemens, which will also maintain the station. The project is expected to take 27 months to complete. Though it is to be private, the government was involved as the consumer of the desalinated water.

The NIS 1 billion desalination plant is in the initial stage of construction by VID, a consortium of the Dankner group, Vivendi, Delek and a subsidiary of the Israel Corp. The plant will supply treated water by the end of 2004, for which the state will pay NIS 2.5 a cubic meter.

Go slow in Hadera

Meanwhile talks between the government and the Israel Electric Corporation are holding up a desalination plant being built on the site of an existing IEC power station in Hadera, according to a senior official source.

The government considered the site suitable for a desalination unit to treat 50 million cubic meters a year, with a later option to double capacity.

The IEC however is unsatisfied with the compensation terms for using its site and infrastructure.

Six months ago Prime Minister Ariel Sharon instructed the director general of the Infrastructure Ministry, Eli Ronen, to reach an agreement with the state-owned IEC over the issue. However, no progress has been made.