The Ramat Hovav Local Planning and Building Commission has approved the construction of a power plant by Makhteshim Agan Industries Ltd. (TASE: MAIN). The natural gas powered plant will produce 120 megawatts of electricity. The company expects to sell part of the electricity to Israel Electric Corporation (IEC) (TASE: ELEC.B22) and other customers.
300 men will build the power station over two years, and several dozen employees will operate it. Investment will be about $200 million. Construction is slated to begin in early 2011.
Edeltech Holding Ltd. subsidiary Ramat Hovav Energy Ltd. will build the power plant. Turkey's Zorlu Industrial and Powerplants Construction Co. Inc. owns 51% of the venture.
Israeli energy sources told "Globes" that, belying recent assessments that Zorlu would reduce or even halt its activity in Israel, due to the diplomatic tensions between Israel and Turkey, the company was continuing its business in the country.
The assessments followed a somewhat ambiguous comment by Zorlu Energy Group chairman Murat Sungur Bursa in the wake of the flotilla incident in May. "Our company opposes using investments for political leverage, but it does not intend to move its business forward in the near future because we do not want it to be said that we're profiting in business when events like this occur," he said.
The statement raised concerns in Israel's energy industry, as Zorlu is involved in the construction of four power plants in the country.
An energy industry source said that, in practice, there was no change in Zorlu's operations in Israel, because of its "deep business involvement in Israel."
Ramat Hovav Local Authority head Andrei Ozen, who serves as chairman of the local building commission, said, "This is a huge investment that should not be taken for granted, given that investment in development at Ramat Hovav has been marginal for many years. The stagnation in investment was strongly felt, and we're now embarking on a new road of business development that will soon be felt."
Published by Globes [online], Israel business news - www.globes-online.com - on September 2, 2010
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