VZCZCXYZ0006
RR RUEHWEB

DE RUEHAM #1882/01 1770619
ZNR UUUUU ZZH
R 250619Z JUN 08
FM AMEMBASSY AMMAN
TO RUEHC/SECSTATE WASHDC 2939
INFO RUEHTV/AMEMBASSY TEL AVIV 1231
RUEHJM/AMCONSUL JERUSALEM 5069
RUEHTH/AMEMBASSY ATHENS 0786
RUEHGB/AMEMBASSY BAGHDAD 6013
RUEHLB/AMEMBASSY BEIRUT 2870
RUEHEG/AMEMBASSY CAIRO 3701
RUEHCP/AMEMBASSY COPENHAGEN 0054
RUEHDM/AMEMBASSY DAMASCUS 3915
RUEHLO/AMEMBASSY LONDON 1224
RUEHFR/AMEMBASSY PARIS 1521
RUEHRH/AMEMBASSY RIYADH 1972
RUEHSM/AMEMBASSY STOCKHOLM 0066
RUEHKO/AMEMBASSY TOKYO 0279
RUEHTC/AMEMBASSY THE HAGUE 0347
RHMFIUU/HQ EPA WASHDC
RUEHDOI/DEPT OF INTERIOR WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC

UNCLAS AMMAN 001882 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/ELA, NEA/RA, AND OES 
STATE PASS TO USAID 
EPA FOR INTERNATIONAL 
USDA FOR FOREST SERVICE/INTERNATIONAL 
INTERIOR FOR INTERNATIONAL/WASHBURNE 
CAIRO FOR VIALA 
 
E.O. 12958: N/A 
TAGS: SENV EAGR PGOV PREL JO IS
SUBJECT: WORLD BANK RED-DEAD FEASIBILTY STUDY COMMENCES AS THE 
PRIVATE SECTOR PUSHES OTHER PROPOSALS 
 
REF:  A) Amman 409 
 B) Amman 228 
 
(U) SENSITIVE BUT UNCLASSIFIED.  NOT FOR INTERNET DISTRIBUTION. 
 
¶1.  (SBU) Summary: The Red Sea - Dead Sea conveyance pipeline to 
move water from the Gulf of Aqaba into the shrinking Dead Sea has 
long been discussed in the region as a savior for the region's water 
woes (reftels).  The USG and several other donors have contributed 
to the World Bank feasibility study, which commenced in May 2008 
with the participation of the beneficiary parties (Israel, Jordan, 
and the Palestinian Authority).  While the World Bank study still 
needs additional funding support, it is the only "official" Red-Dead 
activity underway.  Two competing private sector firms have also 
offered proposals with a broader approach, including the development 
of economic zones and tourism, and are vying for attention.   The 
prospects for any of these mega-projects as a long-term solution to 
regional water problems remains unclear.  End Summary. 
 
World Bank Red-Dead Feasibility Study Commences 
--------------------------------------------- -- 
 
¶2.  (U) The Red-Dead conveyance mechanism is seen by many in the 
region as a long-term savior to the region's water woes.  Besides 
conveying large quantities of water from the Red Sea to rehabilitate 
the shrinking Dead Sea, the conveyance would also desalinate as much 
as 600 million cubic meters (MCM) of drinking water for Jordan, and 
generate hydropower for desalination and electricity.  Another 250 
MCM of drinking water is planned to be available for the Palestinian 
Territories. 
 
¶3.  (SBU) The USG and several other donors (France, Japan, the 
Netherlands, and Greece) have provided financial assistance to the 
World Bank to lead a two-year, $14 million Red-Dead Study (RDS). 
Despite a $3.5 million funding shortfall, the World Bank in April 
2008 awarded one tender to the French company Coyne et Bellier for a 
technical/financial feasibility study, and another to Environmental 
Resources Management of Britain to carry out an environmental and 
social assessment.  The GOJ has requested USAID Jordan to augment 
its initial $1.5 million in funding for the study.  NOTE:  USAID is 
currently exploring additional funding options for the RDS, but has 
made no commitment to increase financial support for the activity to 
date.  END NOTE.  Other potential donors include Sweden and Denmark. 
 Without the additional funds, components of the technical and 
financial feasibility study will be dropped or truncated, including 
examination of alternative scenarios to the Red-Dead canal which was 
strongly pushed by environmental NGOs and other stakeholders opposed 
to the project. 
 
¶4.  (SBU) The World Bank and the beneficiary parties officially 
launched the RDS project in late May.  Despite high-expectations 
from the governments, the World Bank has been careful to note that 
the RDS is a feasibility study, and there is no forgone conclusion 
that a water conveyance structure will be built.  While the 
beneficiary parties strongly support the process for its 
cross-cutting benefits including regional cooperation, the political 
viability of such cooperation will add to the project's complexity. 
 
 
Montgomery Watson Harza Proposal 
-------------------------------- 
 
¶5.  (SBU) Montgomery Watson Harza (MWH), a global vendor of water 
management and engineering services based in the U.S., has developed 
its own proposal for a Red-Dead canal, which includes the creation 
of several lakes along the Jordan-Israel border to attract tourism 
 
 
and create economic development zones that draw industry and 
employment to the area.  Relying on the experiences of similar 
projects in Arizona and Nevada, MWH believes its proposal is 
financially sustainable and more likely to attract the necessary 
private sector financing to assure the project's viability.  The MWH 
proposal is not positioned as a competitor to the RDS, but expects 
to use the results of the RDS as input to commencing its project. 
 
¶6. (SBU) MWH representatives have been promoting the proposal in 
Jordan, Israel and the Palestinian territories for more than a year. 
 Noah Kinnarti, an Israeli Presidential advisor and longtime water 
expert who participated in crafting the water provisions of the 
Israel-Jordan 1994 peace treaty, noted that the MWH proposal is not 
viewed favorably in Israel.  Recent discussions with Jordan's 
Minister of Water, however, indicate that the MWH proposal is 
gaining traction in Jordan.  Noting the lengthy World Bank 
procurement and project cycles, as well as the inherent difficulties 
in regional concurrence, Jordan's Water Minister Raed Abu Saud told 
NEA Senior Science and Technology Advisor Charles Lawson that Jordan 
will need to speed up implementation of the Red-Dead project once 
the RDS is completed.  Abu Saud went on to note that he will engage 
MWH to begin planning for Jordan-specific implementation of the 
project once the RDS is completed. 
 
Israeli Real Estate Mogul Tshuva Joins the Fray 
--------------------------------------------- -- 
 
¶7.  (SBU) Israeli real estate mogul Yitzhak Tshuva unveiled his own 
construction plans in May 2008 for building a water conveyance from 
the Red Sea.  While similar to the MWH proposal, it has two main 
differences:  1) a large 200 MCM desalination plant would be built 
on the Aqaba-Eilat border to move the desalinated water to five 
lakes and different economic zones and tourism sites along the 
border up the Arava valley (other plans call for power generation 
from the 500 meter drop in altitude down to the Dead Sea and 
desalination nearer to that site); and 2) the canal would not go all 
the way north to the Dead Sea.  Tshuva envisions having an 
additional three million Jewish inhabitants populate the Wadi Arava 
desert surrounding the canal and lakes.  The canal area would also 
be a free-trade zone, in order to provide incentives and encourage 
foreign companies to take part in the project and build factories 
and convenience stores along the canal.  Tshuva reportedly said that 
the project could be completed in two years and has the potential of 
creating more than one million new jobs.  The Israeli billionaire 
has supposedly enlisted the support of Saudi Prince Al-Walid bin 
Talal, and other prominent business people to form a regional 
council for this project. 
 
¶8.  (SBU) Kinnarti noted that Tshuva's proposal -- which has no 
connection to the RDS -- has been presented to Israeli President 
Peres and Jordan's King Abdullah and received a favorable response. 
Tshuva's project also builds on a regional framework requiring close 
collaboration between the core parties, leading Kinnarti to state 
that Peres' vision has yet to generate 1 cm of water. 
 
¶9.  (SBU) Comment: The start of the RDS marks a significant 
milestone for the beneficiary parties who are eagerly awaiting some 
tangible results after many years of discussion.  While all the 
proposed solutions are premised on regional cooperation, there 
exists the potential for either Jordan or Israel to consider 
implementing a scenario on their own to short-circuit the political 
concurrence requirements.  As the different scenarios play out, the 
progress and results of the RDS will be watched with keen interest. 
Even with a positive go-ahead after the RDS, it is unlikely that the 
donor community would contribute the billions of dollars required 
for implementing such a large-scale project, which may make the 
 
 
private sector proposals appear more attractive.  Moreover, USAID 
Jordan maintains that large projects like Red-Dead should not be 
viewed as a panacea to water scarcity in the region.  At least in 
Jordan, there continues to be a critical need to examine current 
water allocations in the country and to increase the overall 
efficiency of water use.  End Comment. 
 
¶10. (U) This cable has been coordinated with NEA/RA Chuck Lawson and 
Embassy Tel Aviv. 
 
Visit Amman's Classified Web Site at 
http://www.state.sgov.gov/p/nea/amman 
 
HALE