Daewoo, Mitsubishi to build Israeli power plant

Holding company Israel Corp said on Sunday its subsidiary, OPC Rotem, had signed a letter of intent to hire South Korea's Daewoo as contractor to build the Rotem power plant in Israel's Negev desert.

The equipment to build the plant will be purchased from Japan's Mitsubishi, Israel Corp said in a statement, adding that the agreements with Daewoo and Mitsubishi will be worth about $470 million.

Work on the 440-megawatt plant is scheduled to begin at the end of 2010 and commercial operations will start in December 2012. 

Payments for maintenance of the main parts of the plant over 15 years will be paid directly to Mitsubishi.

The companies are working towards signing binding agreements by June 22. 

OPC Rotem also has an option for an additional similar plant at the same price if it decides to build another power plant in Israel in the next year and a half.