Under U.S. Pressure, Israel Rejects Chinese Bid to Build Largest Desalination Plant

TEL AVIV – Under U.S. pressure, Israel has appointed a local company to construct Sorek 2, a desalination plant that is set to become the world’s largest, rather than a Chinese company. 

The news comes a week and a half after Secretary of State Mike Pompeo’s visit to Jerusalem during which he urged Israel to reduce ties with China.

Among the bidders for the $1.4 billion contract was Hutchison Water, an affiliate of the Chinese CK Hutchison Group based in Hong Kong.  The company was founded by Li Ka-shing, listed last year as the world’s 30th richest man.

Instead, the Finance Ministry tapped Israel’s IDE Technologies to build the plant which will be completed in 2023.

The U.S. has called on Israel and several other allies to sever ties with China in areas with security risks. The proposed desalination plant, as well as being part of Israel’s strategic infrastructure, will also be built in close proximity to both the Sorek Nuclear Center and the Palmachim airbase.

The U.S. specifically flagged Hutchison Water’s involvement in the proposal, and according to one Israeli official, called on Israel to “re-examine the participation of the Chinese company in the tender.”

Sorek 2 is slated to desalinate water at the cost of NIS 1.45 per cubic meter ($0.41) – NIS 0.65 ($0.19) cheaper than existing desalination solutions, according to a statement from the finance and energy ministries. By 2023, the plant will produce 200 million cubic meters a year of desalinated water from the Mediterranean, the statement said.

“About two years ago, I passed a revolutionary government program to deal with future periods of drought, during which I decided to double desalination targets by 2030,” said Energy Minister Yuval Steinitz.

“The desalination plant being initiated today, which will be the largest of its kind worldwide, is the result of the implementation of this program, and together with the desalination facility in the Western Galilee that has already in progress, a significant increase in the scope of development and additional steps, the state of the Israeli water market and its readiness for the future are excellent.”