Drinking water in the service of the potash industry in southern Jordan Valley

Factories “watered” while farms left thirsty

This investigation reveals how an industrial company with multinational capital exerts control over the water of the southern Jordan Valley in Jordan. The influence of the company over these water resources is compounded by poor implementation of a project for a concrete dam, funded by this company and supervised by the government. This problem caused an increase in the cost of the project and gave the company, in exchange, the right to uncontrolled use of water resources in one of the most fertile, yet water-poor, agricultural areas of Jordan.

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Hamdah strolls through her small farm not far from the shores of the Dead Sea examining her trees and some of her leafy crops. This summer, and for years past, she has been able to plant only a few crops. “The companies take water from Al Mujib, Wadi Bin Hammad and Numeira and this has affected us a lot. It’s first come, first served,” she says.
Her farm in the southern Jordan Valley covers only seven dunams. And even then, Hamdah cultivates only half of it each summer.
Hamdah has lost a number of her trees because of the salinity of the water she receives from the Jordan Valley Authority, the government agency responsible for providing water in the area.
Hamdah pays 15 dinars a month for the water, which she also filters and uses for drinking.

Thirsty Farms

In the past, Hamdah relied on the farm to feed her family, after her husband had his limbs amputated, following an accident. But she feels things are now even harder than before.
“The income we make in the summer is not enough for us. Today we’ve sold nothing,” she adds.
We left Hamdah’s farm and headed south, where there are a number of small farms whose owners depend on agriculture for their livelihood.
The air was so hot it was like steam from a kettle and the sun shone fiercely through the car windows. We got out twice to get some respite, while the camera team tried to capture some of the magic of the place. On the right stretched the seashore and farms with various crops growing. On the same side were extensive ponds of potash salts, while on the other side you could see industrial plants, set against the slopes of rugged mountains looking out majestically over the sea.
The Jordan Valley has fertile soil and a warm climate throughout the year. The southern section accounts for about half the river valley area inside Jordan. Its several districts include Ghor Al-Haditha, Ghor Al-Mazraah and Ghour as-Safi, which lies at the end of the Wadi al Hasa. The area of the valley that lies in Kerak Governorate is poverty stricken, but still provides food for the Jordanian population in summer and winter.
Ghour al-Safi is the third largest area for summer vegetable production in Jordan. It also provides a fifth of the country’s winter vegetable crop, even after the halving of production over the last ten years.

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After a lengthy journey, we drew up at young Harith Al-Hashush’s farm, which appeared to be suffering from a lack of water.
Al Hashush says he was forced several times to buy a tank of water to rescue his crops, because of the water shortage. “Most of the wells near us in the Jordan Valley belong to the Arab Potash Company… the Jordan Valley Authority is responsible for the whole river basin, but looks after the potash company more than it does the farmers.”
We left Al Hashush’s farm and crossed to the other side of the valley. One the way, we passed the site of old sugar mills, in an area local people call Sheikh Issa Hill. There is nothing to see but the remains of stone mills built centuries ago for pressing sugarcane, powered by the abundant water there.

Near the end of the day, we reached Khinzirah and there met Suleiman Al-Saidiyain, who shares the worries that other farmers have about securing water to irrigate their crops.

Harith Al-Hashush was forced to buy tanks of water to save his crops, because of a shortage of water
Harith Al-Hashush was forced to buy tanks of water to save his crops, because of a shortage of water

Like many living in the valley, Al-Saidiyain rents land from the government on which he plants two types of crops during the year. He says he cannot cultivate any crops in the summer. Beginning in the spring, he collects the water provided by the Jordan Valley Authority in a pond, which he uses to irrigate his tomato crop. “The water we get is not enough. If we want to plant in the summer, we can’t do it in winter.”
He also says that what the land produces is insufficient to meet the payments to the state that accrue from renting the land. “In the end I’ll be carted off the jail,” he says bitterly.
Fathi Huwaimil, former member of the council in Kerak Governorate, explains that the decline in agriculture over the last ten years has resulted in an increase in farmers’ debts, which are estimated to be in the millions. He warns that dozens, or even hundreds of farmers face imprisonment.

Farmers dig artificial ponds at their expense to because of the water shortage
Farmers dig artificial ponds at their expense to because of the water shortage

The UN says that Jordan is one of the countries most threatened with drought, caused by climate change. The southern Jordan Valley has seen a decrease in rainfall in recent years. In Ghour al-Safi, the amount that fell during the rainy season between 2015 and 2020 declined by 70%, according to Jordanian Meteorological Department figures.
Analysis of data from Jordan’s Department of Statistics shows that the area of cultivated land in Ghour al-Safi decreased by about 38% over the last decade. Vegetable cultivation was the most affected. There was a decline during this period of roughly a half in areas cultivated, while the expanse of barren areas increased sixfold. The Department of Statistics data, however, refers to these as areas left fallow.
Water expert Hazim El-Naser explains that the southern Jordan Valley has one advantage over other areas in the valley in that harvesting of agricultural crops takes place there before any other part of the Mediterranean basin. He stresses the need to find water resources to maintain this area, even if the cost is high.
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Water, the secret of industry

El-Naser, a former minister of water, argues that the southern Jordan Valley is an area of water poverty, since the dams and wadis there rely fundamentally on flooding, which come mostly from outside the area.
A water expert, Al-Naser points to a flaw in the calculation of the balance of resources and needs in this region. “The water requirements in this area differ from all other agricultural areas. There is a conflict between the drinking water that goes to Amman from the Al Mujib dam and is piped to the capital and the water piped to the Arab Potash Company facilities, which is on the increase. And these plants need large amounts of water,” he says.
The Arab Potash Company is the eighth largest global producer of potash, which is used mostly for fertiliser. It is the only Arab potash producer.
The potash reserves lie in the region of Ghour as-Safi. The production of potash salts requires large volumes of water. The company uses in its industrial processing both underground water (54%) and surface water (19%).
The company says that is has developed a strategy to rationalise its water consumption, diversifying sources of water and increasing storage capacity. According to its latest report, the company strove to increase the capacity of water storage tanks by 44% and built a new pond that could hold 80,000 cubic metres. It also drilled new wells to make up for depleted storage wells and to meet the needs of the local community.
Nevertheless, the company last year changed the way it divides up the sources of water on which it relies to carry out its operations and, in doing so, increased its use of ground and surface water and cut the municipal water consumption. The company decided to use 53.8% of the groundwater drawn from 21 wells, located in six regions.
The company has the right to all the water it requires under the terms of a concession agreement with the Jordanian government. It can extract from the Jordan River, from Al Mujib, Ma'in and Swemeh all the clean water it needs for salt and mineral extraction and any other process the plant carries out. It has the right to drill clean water wells in the concession area and to use water from springs outside the concession area, where it does not have special rights. The company also has the right to request expropriation at its own expense.

Funding in exchange for water

In 2014, the Arab Potash Company offered the Jordanian government a grant for construction of a dam in Wadi Bin Hammad, in the southern Jordan Valley. The company funded the dam to the tune of 26 million Jordanian dinars [$37m] in exchange for receiving approximately 2.5 million cubic metres of water a year – the equivalent of 63% of the annual capacity of the dam – at a preferential rate of one quarter of the price offered to the industrial sector. This was known as the “funding in exchange for water” agreement.
The agreement was to run for 12 years, but it was extended for another four years. At the same time, the company’s water allocation was increased, because of weak technical studies and poor management of the project. This doubled the cost of the project and increased the company’s share of the financing.
Geological problems with the dam's foundations were uncovered during the implementation phase, which led to the design being modified several times. The agreement was also repeatedly added to, most recently in 2019, with an addendum increasing the water allocation to the company, even though dam storage levels were insufficient to meet the all the needs of the region, according to a book written by director of operations for the dam.
The “funding in exchange for water” agreement was not the only one between the government and the potash company. Under an agreement covering water exploitation, the Arab Potash Company was given the right to use groundwater wells both inside and outside the concession area, while the Jordan Valley Authority was committed not to drill new wells itself or grant drilling licenses. The agreement also prevented the authority from raising the price of water, while allowing for it to be reduced.
A report by the Audit Bureau indicated that the authority had failed to install meters on underground wells and had not monitored the Arab Potash Company meters to calculate the price of extracted water. Nor was there a minimum or maximum limit set for extraction from underground wells.

Water agreement between Arab Potash Company and Jordanian government
Water agreement between Arab Potash Company and Jordanian government

Saad Abu Hammour, former secretary general of the Jordan Valley Authority, sees the agreement between the authority and the Arab Potash Company as a fair one, arguing that the company sought to recoup the cost of building the dam by obtaining subsidised water in quantities laid down in the agreement.
Abu Hammour says that in 2021 the company implemented a project to pipe roughly 550 cubic metres an hour of spring water from Wadi Bin Hammad that was divided equally between the potash company and the Jordan Valley Authority.
In 2019, Abu Hammour left his position as secretary general of the Jordan Valley Authority, and was appointed a consultant on water and dams to the head of the management board of the Arab Potash Company.
Abu Hammour says that the company uses large amounts of water and that water provided by the authority is not sufficient for its needs. But he denies that there are wells without meters fitted, while confirming that the agreement signed in 2019 makes no provision for this. He says that the Arab Potash Company pays half a dinar for every cubic metre of water from wells it has dug for industrial use, and also pays the operating costs.
The assistant secretary general of the Jordan Valley Authority, Raed Soub, says that he works in the “field” and has not seen any farmers suffering. “Farmers must take care to secure the quantity of water they need for agriculture.” He reports instances where farmers have encroached on waterpipes and on upstream water sources.
The former member of the council in Kerak Governorate, Fathi Huwaimil, confirms that all farmers have made encroachments on water supplies in the region, but says that companies have done the same. He argues that the shortage of water farmers experience in the southern Jordan Valley has forced them to pay from their own pockets to construct ponds to collect water, since the authority has shown itself unable to secure the quantity of water they need.
The Jordanian government first tried to build a dam in the southern Jordan Valley more than a decade ago. Tenders for technical studies and the choice of site were referred in 2008 to a consortium made up of a Jordanian company, Consolidated Consultants Group, Swiss company Stucky and the Bernard Group in Austria.
Lack of funding held up construction of the dam, but in 2014, the Arab Potash Company offered a grant of 26 million Jordanian dinars [$37m]. Poor technical studies and a change in the site meant cost of the project doubled, with the share of company funding rising to 51.5 million Jordanian dinars [$73m].
In response to a question submitted in 2022 to the Ministry of Water and Irrigation by the member of parliament Majed Al Rawashdeh, the ministry held the advisory coalition, to which the Bin Hammad dam tender had been referred, responsible for mismanagement, inaccurate design and wrong decisions during implementation.
According to the ministry, the Jordan Valley Authority brought an arbitration case claiming “damages it had suffered” as a result of mistakes made by the consultants, who were the coalition of three companies. The case was registered at the Permanent Court of Arbitration in The Hague, and court data shows the two parties to Case 08-2022 as the Jordanian government on the one hand, and the two foreign companies on the other. Correspondence between this investigation team and the court revealed that the name of the local partner in the coalition is not mentioned in the file of the case, which is still pending before the court.

Geological problems were revealed in the foundations of the dam during implementation
Geological problems were revealed in the foundations of the dam during implementation

“There are many question marks over this dam - its cost and how it was managed and planned,” says Abdel Fattah Touqan, a regional construction expert.
In an interview conducted by the investigation team, Touqan added: “Many changes were ordered to the project, and these grew as a result of mismanagement, poor design and implementation.” In articles he wrote, Touqan discusses the details of government projects and the way they have been managed and questions both the integrity and transparency of procedures.
Touqan previously criticized the raising of the Wala Dam, which included in its advisory team the same local company that had overseen the Bin Hammad dam. The same contractor also executed both projects.
Once the height of the Wala Dam was raised, there was a threat that it could collapse if it was filled to a level greater than its previous capacity, because of an error in raising process. This cost about 28 million Jordanian dinars [$40m] and meant the dam had to be emptied if there was heavy rainfall which filled it to a level higher than its previous capacity. The government has prepared a national emergency plan to evacuate the area below the Wala dam, if there was is increased risk the dam could be inundated or collapse.
In the case of the Bin Hammad dam, Touqan holds the government responsible for errors in implementation and the consequent doubling of its cost. “It’s not just a question of engineering mistakes or errors in implementation. There are management errors by the government.” Touqan points out that the government owns the project and changes can only be made with the agreement of the owner. Therefore no payments either will be made without its go ahead.
The Bin Hammad dam was not the last domestic project undertaking by the Jordanian company. This investigation team has monitored subsequent government projects submitted to the company. The latest was planning for a government healthcare scheme.
The company makes annual payments to the state treasury that include government profits, taxes and mining fees. The average value of company transfers to the treasury since 2013 is 65 million Jordanian dinars [$92m], except for 2019 and 2021, which saw a doubling of transfers.
The amount the company gives to different community sectors and official bodies is, on average, about 7.5 million Jordanian dinars [$10m], but during the year of the pandemic, the value of these payments reached roughly 30 million Jordanian dinars [$42m].
We have tried to find out more about the Bin Hammad dam project through the websites of the Austrian company Bernard and the local Jordanian company, but it was like following up a fairy tale. Neither of the two companies mention anything about this project. We had some luck when we looked for the name of the project in a number of biographies posted on professional networking platforms. These were biographies of past and present employees of the three companies that formed the coalition. We also found on the internet an electronic “publication” from the Consolidated Consultants Group that mentioned the Bin Hammad dam project. Looking for the Stucky company online proved impossible, since it merged with the Swiss company Gruner some years ago.
The Gruner company (the company which resulted from the merger), which specialised in engineering consultancy, announced last year that had changed the Stucky brand for carrying the Gruner name.
An investigative organisation reported in late 2022 that Stucky SA – another name for the Stucky and Gruber company, according to its commercial registration - was suspected of involvement in bribery of a former government official in the Democratic Republic of Congo and in an energy generation plant there.
The engineer Miguel Stucky, founder of the parent company, appears in a photograph published by Gruner of the company’s management board. His name also cropped up after the collapse of two dams in Derna in eastern Libya in September 2022. The Wall Street Journal reported that the Libyan government had asked Miguel Stucky to evaluate the state of the two dams in 2003, and Stucky had recommended that the construction of both dams needed strengthening.
Stucky had owned a construction company in Tripoli. But after it was seized by the Libyan government, Stucky did not return to the country because of a crisis between Switzerland and Libya that arose when Hannibal Qaddafi was arrested in Geneva in 2008, on suspicion of mistreating his employees. The newspaper did not explain the role the company had played in supervising the rehabilitation of the two dams.
We monitored the Swiss press for several years, looking for anything connected to Stucky. We found a report published 14 years before by Le Temps online which showed that Stucky SA, based in the Swiss town of Renens, had been active in Libya for many years, specifically in dam construction.
Work on the Ibn Hammad dam project ended in the spring of 2022. Fathi Al-Huwaimel says that the dam contains only a small amount of water and has done nothing for farmers.

By Shorouk Omar and Muadh Al Zurek.
This investigation was carried out with the support of ARIJ.
Original article:

  • Princess

    18 w

    This revelation about the multinational company's control over water resources in Jordan is deeply troubling.

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