$3 million pact may grow as Gulf emirate faces growing water shortages

Israel Fisher Michael Rochvarger Mar. 29, 2021

Israel's state-owned water company Mekorot.
Israel’s state-owned water company Mekorot.Credit: Kobi Gideon/GPO

Mekorot, the Israeli state-owned water company, has signed an agreement to provide $3 million in consulting services to Bahrain Electricity and Water Authority in the first-ever agreement between an Israeli government company and the Gulf emirate.

The agreement covers advice on projects involving water, desalination, automated control and technology upgrades, Mekorot said in a statement to the Tel Aviv Stock Exchange. TheMarker has learned that Mekorot chairman Mordechai Mordechai and CEO Eli Cohen visited Bahrain last week to sign the agreement.

Officials in Bahrain and the United Arab Emirates said at the time they reached normalization agreements with Israel last September that water and other green issues would serve as a major driver of bilateral cooperation as the Gulf states struggle with the impact of climate change.

“The four countries that have signed peace agreements in the framework of the Abraham Accords suffer, like us, from a water shortage, so innovative solutions from Mekorot and Israeli high-tech companies in the area of water can serve as a strong basis for cooperation and for strengthening ties,” said Energy and Water Minister Yuval Steinitz in response to news of the agreement.

A desert island nation without lakes or rivers, Bahrain obtains 54 percent of its water from groundwater. Desalination plants developed in recent years supply another 36 percent for its population of 1.6 million, but the country faces new threats and must develop new sources and recycle existing supplies as it depletes more and more of its groundwater supply.

In negotiations over the agreement, Mekorot officials were provided with information on Bahrain’s water needs and ways it has been coping with tighter supplies as well as the impact of climate change. Bahrain’s EWA wants to focus future efforts on ensuring supplies to households and agriculture as well as reducing waste and ensuring reliable supplies to the entire country.

Mekorot will help the EWA in adopting the most advanced desalination technology, working toward more efficient energy use, and improving services to populations not connected to the national network. It will also consult on the development of new desalination plants and aid in exploiting natural water sources.

The first phase of the agreement is worth $3 million, but it is expected to grow to $11 million as the two sides engage in additional projects. The two sides also discussed the possibility of Mekorot undertaking an engineering-supervision role in construction or planning projects, which would increase the dollar value of the agreement, Mekorot said.

In addition, the business division of Israel’s Bank Hapoalim will provide consulting services for a number of water projects in Bahrain.