Rapac is building two IPPs in the north of Israel for 80 million. The stations are valued at 1.2 billion shekels.

The Ramat Gavriel IPP station in Migdal HaEmek has an exclusive agreement to sell electricity, steam and water to Nilit. The power station in the Alon Tavor industrial zone will sell its electricity and steam to Tnuva.

Energean is due to supply the natural gas to both stations.

Rapac and American fund Denham Capital bought 57% of the power stations in equal shares from Delek in August 2012 for $5 million in cash and an additional $4-$6 million payment upon financial closure. In January 2014, they acquired another 11.2% each for $3.7 million and later exchanged shares with a third station they owned, leaving Rapac with both stations together with its partner Gat Energy. The turbines are being built by Siemens at a cost of 700 million NIS.

The stations were due to be completed in H2 2018 but Rapac’s Q2 statement that was published on Tuesday indicates that construction will continue until Q2 2019. The company claims that the delays are mainly the result of “work vis-a-vis IEC and negotiations with Siemens regarding the responsibility for the setbacks in the completion of the project.” Rapac also claims that it is eligible for late fees from Siemens, although Siemens itself has demanded payments for excess costs “at a sum that exceeds the late fees.”

According to Rapac, the delays have increased the costs of the projects by 72 million NIS.