PM greenlights petrochemical company’s takeover of Israel’s biggest oil refinery

Prime Minister Yair Lapid on Tuesday approved a bid by Israel Petrochemical Enterprises to acquire full control of Bazan, Israel’s largest oil refinery, in the Haifa Bay in northern Israel.

Government approval for the takeover was required because the oil refineries are defined as an essential industry.

Lapid did not condition the sale on Bazan’s closure within a decade, despite a government decision in March to do so and pressure from Environmental Protection Minister Tamar Zandberg, lawmakers such as Blue and White’s Alon Tal, and environmental groups.

But a notice to the Tel Aviv Stock Exchange said that the new sole owners of Bazan — David Federman, Jacob Gottenstein, Alex Passal and Adi Federman — had informed Lapid of their commitment to cooperate fully with the relevant authorities on implementing the government’s decision to develop and advance the Haifa Bay, which would include setting up a team to negotiate Bazan’s closure and compensation to do so.

To the disappointment of environmental groups, the March government decision included neither a detailed timetable for the closure nor a budget for the redevelopment of the area.

The shutdown vote followed years of campaigning by Haifa residents, backed by environmental activists, against a backdrop of significant air pollution and above-average incidences of cancer and respiratory disease in the bay city.

The finance and energy ministries approved the sale on Sunday.

On Monday, the Tel Aviv District Court greenlit a related debt-restructuring plan for Israel Petrochemical Enterprises that will cost the public NIS 1 billion (just under $300 million) in lost national revenue.

Israel Petrochemicals, which holds 15% of the Bazan oil refineries stock — enough to become a joint owner — used its right of refusal to veto an earlier bid for Bazan by the Hagag Group of property developers.