State told to explain why it slashed NIS 65 million from Dead Sea Works water bill

High Court order represents latest stage in battle by nonprofits to get Idan Ofer’s mineral extraction company to pay for the water it uses

Sue Surkes is The Times of Israel's environment reporter

A view of the Dead Sea Works in southern Israel on February 2, 2018. (Issac Harari/Flash90)
A view of the Dead Sea Works in southern Israel on February 2, 2018. (Issac Harari/Flash90)

The High Court of Justice on Sunday ordered the state to explain why the state-owned Mekorot water company is not charging a Dead Sea mining company for the water it uses. It gave a 60-day deadline.

Two nonprofit organizations — Adam Teva V’Din and Lobby99 — petitioned the court as part of a long-running battle to get Dead Sea Works in southern Israel to pay.

In October 2021, the state wiped NIS 65 million ($17.5 million) off a NIS 83 million ($22.3 million) water bill sent to billionaire Idan Ofer’s mineral extraction company Dead Sea Works, because the Justice Ministry was not sure it could prove in court that the company was obliged to pay its water bills in full under the terms of the Water Law.

It remains unclear whether Dead Sea Works paid the difference.

The company argued that the bills were covered by the royalties Dead Sea Works pays the state and that its franchise agreement took precedence over the Water Law.

The October decision related to water from wells that Dead Sea Works pumps from areas within its franchise area, for use in its industrial processes.

A canal that takes water pumped from the Dead Sea uphill to evaporation pools at the Dead Sea Works. (Sue Surkes/Times of Israel)

It also does not pay for the saltwater it pumps from the northern Dead Sea because salinity there exceeds levels for which water can be charged, according to current regulations.

Adam Teva V’Din argues that agreements giving the company rights to mine potash, bromine, and magnesium from the salt-water lake neither rule out the applicability of the Water Law nor the company’s obligation to pay its bills.

In late 2019, Adam Teva V’Din won a rare victory against the powerful company in the Haifa District Court. Judge Ron Sokol ruled then that the Dead Sea was definitely covered by the Water Law and should therefore be subject to a water license. He ruled that the Concession Law was meant to protect the company from competition, not to restrict the applicability of the Water Law or to absolve the company of its obligation to pay its water bills.

The Water Authority did start to issue licenses, in line with the court’s ruling. But after the Mekorot water company presented the Dead Sea Works with the NIS 83 million water bill, the Water Authority withdrew the bill, after consulting with the Justice Ministry.

A danger of drowning sign on the way to the Dead Sea Works from where the sea has long since receded, January 20, 2022. (Sue Surkes/Times of Israel)

The Dead Sea has shrunk by half since the mid-1970s due mainly to the diversion for human needs of water from rivers and streams that would naturally flow into it.

Dead Sea Works and Jordan’s Arab Potash Company pump out around 600 mcm per annum of water from the sea and return just half that amount after evaporation and extraction of minerals.

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