SASKATOON — Potash Corporation of Saskatchewan Inc. (PotashCorp) last week confirmed reports that it is considering increasing its ownership stake in Israel Chemicals Ltd. (ICL).

“Discussions have occurred with Israeli government officials around potential options to increase our ownership stake in Israel Chemical Ltd.

“No deal has been formulated, there is no assurance that a deal will be reached, or that parties will sign an agreement,” the release states.

Israel Corp., a holding company whose assets includes ICL, confirmed Potash’s interest.

“The company confirms that PotashCorp, a Canadian company, engages in discussions with various governmental authorities, and in that framework… a meeting was held with the prime minister of Israel, in connection with the examination of a possibility for a merger between ICL and Potash.”

Israel Corp. stressed, “There is no certainty that a deal will be made.”

In Israel, Prime Minister Benjamin Netanyahu acknowledged he took part in talks with Bill Doyle, chief executive of PotashCorp.

Quoting bankers and analysts, The Wall Street Journal reported any deal for a significant increase in Potash’s stake in ICL could face significant political obstacles in Israel: “The government would have to sign off on such a deal, given ICL’s mining interests in the Dead Sea, a body of water shared between Israel, Jordan and the Palestinian West Bank.”

In addition, the Israeli government could come under pressure from environmental groups to block the deal, the newspaper suggested.

ICL’s mining operations, at more than five million metric tons a year, is the lowest cost potash production in the world.

“These investments are the second best potash assets in the world after our own [in Saskatchewan],” Doyle said.

ICL, which is traded on the Tel Aviv Stock Exchange, is valued at $15 billion. Potash Corp. currently owns a 14 per cent stake in the company; Israel Corp. owns a little over 52 per cent.

PotashCorp is the world’s largest crop nutrient company whose products are used for global food production. It is the largest producer of potash and third largest producer of nitrogen and phosphate, used by farmers to increase crop yield.