Israel Chemicals to build NIS 1.25b power plant

The 250 megawatt plant at Sedom will run on natural gas.

1 July 12 10:48, Globes' correspondent

Israel Chemicals Ltd. (TASE: ICL) unit ICL Fertilizers will build a 250-megwatt natural gas-powered combined cycle cogeneration power plant in Sedom, at an investment of $320 million (NIS 1.25 billion). The new plant will replace the 1995 plant, which uses diesel and heavy fuel oil. The new plant will meet ICL Fertilizers' needs for the next 20 years, while reducing the company’s energy costs and protecting the environment.

The new plant is based on a gas turbine supplied by Siemens AG (NYSE: SI; DAX: SIE), which can also be powered by light fuel oil, if necessary, and a steam turbine capable of generating 330 tons of steam per hour. Construction is due to begin in the third quarter of 2012 and to be completed during the second half of 2015. The plant's cogeneration utilizes 85% of the fuel’s energy potential, compared with 50% by combined cycle power plants.

ICL Fertilizers CEO Dani Chen said, “The construction of our new power plant is an important strategic step that will secure our long-term energy needs, while moving us forward in our pursuit of ever-higher achievements of environmental protection, safety and sustainability. The plant’s use of a combined cycle cogeneration architecture utilizing a Siemens gas-fired turbine will enable us to generate steam and electricity at exceptionally high efficiency, thereby lowering its cost while enhancing its environmental profile."

Israel Chemicals' share price rose 1.7% in morning trading to NIS 42.70, giving a market cap of NIS 53.5 billion.

Published by Globes [online], Israel business news - www.globes-online.com - on July 1, 2012

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