Jacob Engel to Pay $570 Million for Right to Mine Hanaton Quarry
White Sands bid substantially higher than its competitors for the right to mine construction materials for 20 years.
White Sands Industries, Ltd, a subsidiary of Jacob Engel’s Elenilto Group, has won an Israel Lands Authority tender to operate the Hanaton quarry for 20 years. The government agency announced the results of the tender two months ago, but White Sands only recently confirmed its plan to actualize the win. White Sands will replace Hanson Israel, which has mined the quarry since the 1980s. The Hanaton quarry, located in northern Israel is one of the country’s largest.
Offering a bid of NIS 36 per ton of materials mined, White Sands beat out eight other companies. The calculation was based on a right to mine an aggregated three million tons a year, working out to NIS 100 million annually of NIS 2 billion (approximately $570 million) over 20 years.
The high price offered by White Sands stresses the capital that has been flowing into quarry owners’ pockets in recent years. The reason for that is that up until a few years ago the Israel Lands Administration marketed the quarries without tender, based on an archaic pricing mechanism. So mining at the Hanaton Quarry, for example, used to be priced at NIS 4.6 per ton.
Jacob Engel. Photo: Courtesy
The price that Engel committed to also sheds light on the severe shortage of supply in the building materials market, which allows quarry owners to charge nearly whatever they like for the raw materials. The situation has sparked complaints by building contractors who claim they will have to absorb the high costs or roll them on to the consumers.
White Sands has been operating in the quarries industry for 20 years and operates quarries all across the country. "This is a significant win that aligns with the company's strategy of expanding mining and asphalt supply to the infrastructure and construction industry,” said White Sands CEO and partner Itzik Amiel. “Even at a time like this, when nearly everything is at a standstill, construction and infrastructure continue and are justly defined as a vital industry."
Engel is currently active in Israel, Europe, and Africa in the fields of mining, oil, quarrying, infrastructure, and real estate.