Tag: alarko

Turkish coal faces a revival

David O’Byrne in Istanbul

February 18, 2013

The recent announcement by Turkish economy minister Ali Babacan that Turkey’s investment incentive scheme is to be expanded to include investment in power plant burning locally produced lignite has re-ignited interest, both foreign and domestic, in Turkey’s sizeable but underused domestic coal reserves.

Despite reserves of 11.8bn tonnes of lignite and 1.3bn tonnes of hard coal – with new reserves still being discovered, development of coal fired power plant in Turkey has been slow with private developers opting to develop quick to cheaper plants that burn gas.

Now with Turkey’s gas demand expected to exceed its 51.8bn cubic metres a year (cm/y) gas import portfolio within the next couple of years, Turkey is keen to reverse the trend and make more use of its domestic reserves. Not just because dependence on gas for power generation last year reached a worrying 42%, but also because energy imports are the single biggest contributor to Turkey’s increasingly problematic trade and current account deficits, the main issue which continues to hold down Turkey’s international ratings. “We have no gas and no oil, so it makes sense to develop the coal reserves we have,” says Ankara-based energy analyst Haluk Direskeneli, explaining that while most of Turkey’s coal is poor quality it is still cheaper to burn than imported alternatives.

“The quality of Turkish coal is low,” echoes Mustafa Karahan head of Turkey’s Energy Traders Association. “But the incentives the government plans to issue will help cut investment costs.”

The black stuff

The past year has seen a slate of new initiatives aimed at making the most of these reserves, with Babacan’s announcement of new incentives following closely on the heels of new legislation allowing for the privatisation of the state-owned coalfields along with the 6.7 gigawatts (GW) of plant they supply, and a slate of new tenders for the development of unexploited coal reserves.

Together this has spawned a surge of interest in new coal plant development, which promises eventually to help re-balance Turkey’s power generating portfolio with 19 plants totalling close to 7 GW already licensed and under development and more projects set to follow.

Already announced is a plan to develop as much as 8 GW of new capacity burning lignite from the massive Afsin-Elbistan field in southeast Turkey.

Abu Dhabi power giant Taqa and Turkey’s state power generation company EUAS signed an memorandum of understadning in late December that will see the pair work together on projects to renovate an existing 1.4-GW plant burning coal from the Afsin field and build a new 1.4-GW plant alongside.

A contract for this first phase is expected to be signed in the next few months, after which work will begin on detailed plans for the remaining 6.6 GW taking the total investment to close on $12bn.

With reserves of 4.4bn tonnes, Afsin Elbistan holds a third of Turkey’s known coal reserves, while the planned 8-GW development makes it the biggest power project in the country’s history, dwarfing even the 5-GW nuclear plant being developed by Russia’s Rosatom.

Other state-owned coalfields are also up for development, with state lignite extractor TKI late last year opening tenders for the development of two fields and the construction and operation of two new coal-fired plant totalling 570 MW.

More tenders are expected to follow with Energy Minister Taner Yildiz recently announcing the discovery of a 1.8bn tonne lignite field near Konya in central Turkey capable of supporting up to 5-GW of coal fired plant, and that plans are underway to open a tender for the development of a separate 510m tonne field in Turkey’s European province of Thrace.

No less significant was the announcement in early February by Turkey’s Hattat holding that it is talks with Chinese and South Korean companies to develop a 1.32-GW plant burning coal from the group’s mines at Amasra in northern Turkey. Hattat plans to sign a deal on the $3.5bn investment by June with construction work slated to begin by the end of the year.

International Coal Opportunity

Turkey’s dash for coal is not limited to domestic reserves. Despite no incentives being offered, interest in constructing plant burning imported coal is high thanks to falling international coal prices. “The discovery of shale gas in major coal exporting countries such as the US, Australia and South Africa means that international coal prices have fallen,” explains Mustafa Karahan.

A slate of license applications have been made for new plant including one from a consortium led by France’s GDF-Suez for a 1.32-GW plant to be built at Yumurtalik on Turkey’s East Mediterranean coast.

Another consortium led by Turkey’s Bilgin Enerji is planning to build a plant of similar size in the same area while Turkey’s Alarko group is planning to build a 1.32-GW plant at Biga on the coast of the Sea of Marmara.

via Turkish coal faces a revival – BUSINESS NEW EUROPE.

February 18, 2013
Alarko to bid to build third Istanbul airport

(Reuters) – Turkey’s Alarko Holding , a conglomerate with interests in construction, energy and tourism, wants to bid in a consortium for a tender to build a third airport in Istanbul, Chief Executive Ayhan Yavrucu told Reuters on Thursday.

Speaking at the Airex aviation exhibition in Istanbul, Turkish Transport Minister Binali Yildirim said they were aiming for the first stage of the airport to open in 2016.

Yildirim announced the tender competition for the Istanbul airport last month with a view to completing the bidding by the end of 2012 after spending 18 months choosing the site.

The airport is to have an initial capacity for 90 million passengers a year, extending eventually to 150 million passengers, and three runways. Yildirim said last month 80 percent of the site would be public land and the rest bought by the state from private owners. (Reporting by Ceyda Caglayan and Evrim Ergin, writing by Seda Sezer, editing by William Hardy)

via Alarko to bid to build third Istanbul airport | Reuters.

September 7, 2012
Flow of Returning Turkish Expats Vital for Growth

ISTANBUL—There may be a rising tide of younger Turks heading back to the motherland, but one of Turkey’s most seasoned tycoons stresses that the fast-growing country also needs to lure home older talent if it is to maximize its growth spurt.

In his cavernous office overlooking Istanbul’s Bosphorus Strait, 84-year-old Ishak Alaton, chairman of Alarko Holding, one of Turkey’s biggest conglomerates, says the country’s economic resurgence has begun to attract highly skilled professionals and academics back; a prospect that could offer Turkish firms a much-needed innovation boost to help them compete on a global level.

Mr. Alaton—who along with U.S. and Scandinavian partners, has set up a Alvimedica, a Turkey-based healthcare company designing top-end catheters and stents sold across the world—is positioning himself as a spokesman for a business community seeking to attract some of Turkey’s most experienced expatriates back home.

“Let’s be frank, Turkey is not the finished article, but the economy is undeniably more solid, and people who’ve reached top-level positions abroad are thinking about coming back; they know they can live very well here, and many people who’ve made their name abroad would like to give something back to their homeland,” says Mr. Alaton, who himself briefly left Turkey to work in Sweden in the 1950s before returning to set up Alarko. “The fact is that we need them if we’re to turn this growth spurt into something more sustainable.”

Turkey’s economy has been underpinned by a tightly regulated banking sector offering record-low interest rates and surging domestic consumption. But analysts say the economy’s success as a mid-level manufacturing and product assembly hub won’t sustain the current levels of growth and rising expectations of a youthful population. In short: it needs top talent to boost innovation.

Through Alvimedica, Mr. Alaton is at the forefront of that drive. The company is located in a sprawling “techno-park” complex less than two hours from central Istanbul, which hosts research and development and manufacturing facilities.

Since its foundation in 2006, Alvimedica has attracted scores of expatriate professionals back from developed economies and is targeting a billion dollars in sales worldwide over the medium term. Almost 20% of Alvimedica’s 200 white-collar employees have returned to Turkey after education or professional experience

abroad.

Mr. Alaton’s pitch is compelling, but thus far, Alvimedica’s experience remains the exception rather than the norm.

Lingering problems frustrate efforts to lure top talent back home. In most cases, highly qualified Turks have to settle for lower salaries and the prospect of a burdensome bureaucracy that can hamper business. Mr. Alaton bemoans the fact that the government hasn’t offered incentives to tempt top talent to repatriate.

“The government has made great strides to improve our economy, but many of our successes have been despite their actions, rather than because of their help,” he says.

Alvimedica’s chief executive, Cem Boskurt, who himself returned to Turkey after a successful career as a surgeon in Germany, concedes that the firm’s experience is atypical, but stresses that it serves an example for other firms looking to attract top talent.

“We’ve worked with international partners to build a research and development center that can produce globally competitive products designed and manufactured here in Turkey,” Mr. Bozkurt said in an interview. “If we’re really going to make our mark, we need to innovate, not just assemble designs coined elsewhere.”

via Flow of Returning Turkish Expats Vital for Growth – WSJ.com.

May 10, 2012