TEL AVIV, March 25 (Reuters) - Israel Chemicals (ICL.TA) said on Tuesday it signed a deal with the Yam Thetis consortium to buy 2 billion cubic meters of natural gas until 2015 in a deal valued at $260 million to $330 million.
The switch to natural gas from oil at Israel Chemicals’ plants will save the company $100 million a year, it estimated.
The supply of natural gas will begin gradually starting in late 2008, depending on the completion a natural gas pipeline to plants in Israel’s south.
The natural gas purchase takes into account plans to expand production at the company’s plants, according to its multi-year strategy.
Israel Chemicals said it is the first large industrial company in Israel that will switch most of its plants to natural gas. The maker of fertilisers and specialty chemicals is one of the largest consumers of oil for operating plants in Israel.
The company said the switch to cleaner natural gas was part of its environmental protection policy.
Yam Thetis is developing a natural gas site off Israel’s southern Mediterranean coast. The consortium is comprised of Noble Energy NBL.N, Delek Driling (DEDRp.TA) and Avner Oil Exploration AVNRp.TA.
Reporting by Tova Cohen, editing by Elizabeth Fullerton