Turkey Financial News » Energy & Transport

Russians pledge Matryoshka like four-layer safety in Turkey plant

meb — Tue, 26 Apr 2011 09:34:48 +0000

As the entire world is now struggling to decide if states’ efforts to develop nuclear energy should continue after what recently happened in Japan’s Fukushima Daiichi nuclear power plant following the March 11 twin earthquake and tsunami disasters, there is also an ongoing public debate in Turkey: People wonder if the Justice and Development Party (AK Party) government is doing the right thing as it seems determined to go ahead with its ambitious nuclear energy program.

Russia’s Rosatom State Nuclear Energy Corporation is equally concerned with the outcome of this debate because it was awarded a $20 billion deal last year to construct a nuclear power plant in the southern Turkish province of Mersin’s Akkuyu district. A recent invitation extended to Turkish reporters to visit the Kalinin nuclear power plant that Rosatom officials say utilizes the same technology planned for the Akkuyu power plant is an effort to tame the growing distrust towards nuclear energy in Turkey.

Safest of all
Addressing reporters during that visit, Mihail Kanishev – the chief engineer at Kalinin – said the Akkuyu nuclear power plant will be the safest of its kind, the Cihan news agency reported on Sunday. What he proposed for the planned nuclear power plant in southern Turkey is “a four-layer Matryoshka doll safety system” used in Kalinin. “In case of an accident, heat absorption, natural circulation and cooling automatically start. These safety systems do not require human intervention to start working,” he was quoted as saying by the agency. For him, the Akkuyu nuclear power plant will pose a risk neither to the surrounding inhabitants nor the environment even in case of a magnitude 9 earthquake as happened in northeast Japan last month or even if a plane crashes into the yet-to-be constructed power plant. “The innermost doll is the reactor itself. What constitutes the second doll is the reinforced concrete surface of the reactor. The third doll is the safely cooling system. The water that circulates inside the reactor does not have any contact with the outside world, and neither does the water in the second cooling layer. Only the third cooling circuit uses water supplied externally. In that way, any possible radiation from an accident can only leak from the third layer. The outermost and fourth doll is a safety measure against any possibility of having the reactor badly damaged. Even if the nuclear fuel remains waterless and starts to melt down, the grid we placed at the bottom of the reactor catches this fuel. And because this grid is cooled down with a separate system, we make sure that no blast happens,” he explained.

Rosatom started building the Kalinin nuclear power plant, which is about 200 kilometers northwest of Moscow, in 1974. Its third reactors became operational in 2004, and a fourth reactor is currently under construction. According to Rosatom officials, the planned nuclear power plant in Akkuyu and the one in Kalinin are very similar in terms of electricity production technology and safety systems. The only major difference according to Kanishev, is that Kalinin has 1,000 MW reactors, but the Akkuyu nuclear power plant will have 1,200 MW ones.

Rosatom plans to start construction in Akkuyu in 2013 and have its four planned reactors operational by 2021. Once completed, it is expected to employ 20,000 people. Turkey is presently heavily dependent on foreign energy supplies but aspiring to become self-dependent by 2023, the centennial of the Republic of Turkey. To that end, the AK Party government is planning to have three nuclear plants operational by the 100th anniversary of the republic, while also intensifying oil and natural gas exploration efforts across the country. The growing environmentalist sentiment seems not to have impacted the stance of the government, which says it will never approve any project environmentally hazardous while pursuing the country’s macro interests. According to government officials, people’s environmentalist feelings are used by certain groups who are not happy with the country’s centennial aspirations.
No to Chernobyl, Yes to Akkuyu

As the latest sign of Turkey’s commitment to its nuclear energy program, which the government says is also environment-friendly, Energy and Natural Resources Minister Taner Yıldız said on Monday that he supports protests organized against old-fashioned nuclear power plants that continue producing energy around the world; however, the planned nuclear power plant in Akkuyu should be supported because it poses no risk to the environment at all.

Noting that Greenpeace members often carrying banners reading “No to Chernobyl” during their demonstrations [in Turkey], Yıldız said the same banner should read “No to Chernobyl, Yes to Akkuyu.” “First generation nuclear power plants that are over 40-years old should be closed. But third generation power plants such as the one we plan to build in Akkuyu are necessary. I think Greenpeace will agree,” he said, speaking at a signing ceremony between the state-owned Turkish Pipeline Corporation (BOTAŞ) and the Swiss energy company EGL Group on the transportation and marketing of oil and natural gas.
source: todays zaman

First domestic diesel train to be source of pride for Turkey

meb — Thu, 21 Apr 2011 07:15:02 +0000

Amid recent debates over creating a domestic car brand in Turkey, a Turkish wagon company has already managed to produce a domestic train named the Anatolia.

The train will run on diesel, making it highly attractive for markets whose transportation system is mainly designed for diesel, the top official of Turkish Wagon Industry, Inc., (TÜVASAŞ), the producer of the trains, told Today’s Zaman.

The country’s first domestic diesel train Anatolia was put on the tracks during a ceremony on Tuesday in the northwestern province of Sakarya. TÜVASAŞ General Manager İbrahim Ertiryaki told Today’s Zaman that the latest available technology was used in producing the wagons, 85 percent of which were produced locally.

Speaking at the ceremony in Sakarya on Tuesday, Ertiryaki briefed the media, noting that the trains were produced in full accordance with International Union of Railways (UIC) standards, namely, the wagons must have fully automatic air conditioning, automatic doors and an electronically controlled brake system. In order to provide maximum passenger comfort, each vehicle has fully adjustable aircraft-type seats, an announcement system and LCD screens. Ertiryaki also said the trains could reach speeds of up to 140 kilometers per hour.

When asked by Today’s Zaman if such developments in the Turkish railway sector could eventually lead to the production of domestic high-speed trains, Ertiryaki said this is in fact the ultimate goal, citing EUROTEM, a TÜVASAŞ and Hyundai joint venture project, to produce cars for high-speed trains.

“As our government has also made clear, the ultimate goal is to be able to produce such high-tech products in Turkey by ourselves in the near future,” he said. Ertiryaki drew parallels to the production of a domestic auto brand and said that such developments in other sectors would have a positive spillover effect on even more sectors.

Ertiryaki said producing a diesel-run train is significant in the sense that it was specifically designed for the needs of countries whose transportation systems mainly depend on diesel. He told Today’s Zaman that several countries from the Middle East to Europe have already shown a keen interest in such wagons.
‘It’s still the beginning for railways’

Addressing reporters during the ceremony on Tuesday, former Transportation Minister Binali Yıldırım, who resigned last month as required by the Law on Elections, said the government will not be content with only this project but will continue to take on other challenging projects as well. He also said the railroad sector in Turkey has shown significant improvement over the last nine years and is set for further progress.

According to Yıldırım, several countries from the European Union as well as Iraq have already placed orders for TÜVASAŞ’s wagons. He gave the example of Turkey’s Locomotive and Engine Industry Corporation (TÜLOMSAŞ), which has already started producing PowerHaul locomotives jointly with GE Transportation in the central province of Eskişehir. “For us it’s just the beginning of the journey,” he said.

Turkey has taken on extensive railroad and highway construction and outfitting projects over the past eight years. According to the Ministry of Transportation, more than 5,000 kilometers of rail have already been overhauled. The ministry has set as its goal for 2023, the centennial of the Turkish Republic, the laying 10,000 kilometers of high-speed train track and 4,000 kilometers of regular track.
PowerHaul locomotives also being produced in Turkey

TÜLOMSAŞ in 2008 signed a strategic partnership agreement with US-based General Electric (GE) to manufacture high-tech diesel locomotives in Turkey and export them abroad. The joint production of PowerHaul locomotives is already taking place in Eskişehir, where such locomotives are equipped with a 16-cylinder PowerHaul engine, GE’s most technologically advanced locomotive engine to date. This new engine, combined with other technologies from GE, is projected to reduce PowerHaul locomotive fuel use by up to 9 percent compared to current operatingfleet averages.
source: todays zaman

Turkish ministry to spend 3.1 billion on Ankara subway

meb — Thu, 21 Apr 2011 07:12:13 +0000

Ankara’s subway system, which has yet to be completed despite 10 years of construction and 814 million Turkish Liras of investment, will receive another 3.1 billion liras from the Transportation Ministry to finish the line, authorities have said.

Subway work between Keçiören and the train station, Kızılay and Ümitköy, as well as between Sincan and Batıkent, will be launched simultaneously and completed within two years, according to the ministry’s plans, Transportation Minister Habib Soluk told journalists Tuesday.

The 44.4-kilometer-long Ankara metro line will cost the ministry 3.17 billion liras, Soluk said.

Although the ministry could take over the metropolitan municipalities’ subway projects as part of a recent legal arrangement, Soluk said the new regulation did not mean his office would take over all projects.

Ankara and Istanbul metropolitan municipalities initially applied to the ministry for a change, Soluk said, adding that procedures to take over the projects were at the final stage.

The project cost for the Istanbul metro was not yet clear, the transportation minister said.

Along with Ankara and Istanbul municipalities, Adana and İzmir metropolitan municipalities have also applied to hand over their projects to the ministry, Soluk said, but added that they were still considering their applications.

Metro constantly under construction

Ankara Mayor Melih Gökçek has repeatedly said the capital city’s subway project would be completed as soon as possible since it first began in 2001, but little progress has been made in recent years.

Contrary to statements, no previously-announced subway line has been completed and the municipality’s website indicates no information either on the estimated date of completion of the cost of the total expenditures so far.

Ahmet Çetin, from the municipality, said in 2009 that they had so far spent 814 million liras for the subway project.

Deadline for third bridge bid in August

Touching on the plans for the construction of a third bridge over the Bosphorus Strait in Istanbul, Soluk said the project would also include a railway.

“But we will see whether the railway will share the same platform with the highway once we receive the proposals on Aug. 23,” Soluk said.

Overall, 12 companies, including six local ones and six international ones, have purchased tender specifications for third bridge. The foreign companies are from Russia, France, Italy, Spain and Austria, the official said.
source: hurriyet

BP Turkey to open 40 new stations

meb — Mon, 11 Apr 2011 22:09:25 +0000

Aiming for growth in parallel with the fuel oil market in Turkey, BP’s local branch plans to open 40 new filling stations in the Turkish market this year, a written statement from BP Turkey said Friday.

Speaking at the Petroleum Istanbul 2011 fair that started Thursday, BP Turkey Fuel Manager Richard Harding said BP offers service quality to its customers with more than 600 filling stations in Turkey.

“We target a strong growth in 2011 in parallel with the fuel oil market. We plan to expand our station network, increase productivity and take 40 more stations in operation,” Harding said. “Being a company that has invested in the Turkish energy sector and economy since 100 years, we will continue investing with our innovative perspective in the upcoming period.”

At the fair, Harding shared his ideas related to BP Turkey’s growth strategy with representatives from the sector. Higher customer satisfaction can only be provided by happy dealers and workers, the BP statement read. It added that BP Turkey implements advanced management standards and programs to increase productivity. “BP Turkey uses all its experience and power to provide a better environment for its dealers,” the statement said.

As well as distributing and marketing fuel, oil and lubricants, BP Turkey’s activities include liquefied petroleum gas, or LPG, commercial and industrial fuels and exploration for petroleum, gas and energy.

Petrol Ofisi share drops

Meanwhile, Bloomberg reported Friday the share of Petrol Ofisi, Turkey’s biggest fuel retailer, in the Turkish fuel retail market fell to 24.7 percent last year from 26.7 percent in 2009, Turkey’s energy regulator said.

Shell & Turcas Petrol, a joint venture between Royal Dutch Shell Plc and Turcas Petrol, raised its market share to 19.1 percent from 18.6 percent and the share of Opet Petrolcülük dropped to 16.6 percent from 17.6 percent, the Ankara-based regulator in an e-mailed statement.
source: hurriyet daily news

Italy, Russia, Turkey sign pipeline deal

meb — Mon, 19 Oct 2009 13:06:39 +0000

Italy, Russia and Turkey signed an agreement on building the Samsun-Ceyhan oil pipeline, according to Eni, Italy’s biggest oil company.

The project underscores a “joint commitment to enhance energy security,” according to a statement issued by Eni on Monday. The pipeline will run between Samsun on Turkey’s Black Sea coast and the Mediterranean port of Ceyhan.

The accord was signed in Milan Tuesday by Turkey’s Energy Minister Taner Yıldız, Italy’s Economy Minister Claudio Scajola and Russia’s Deputy Prime Minister Igor Sechin and Energy Minister Sergei Shmatko.

Eni and Turkey’s Çalık Holding, which each own 50 percent, also signed a memorandum of understanding with Transneft and Rosneft on the participation of the Russian companies, according to the statement.

The 550-kilometer (342-mile) link, known as the Trans Anatolian Pipeline, will have a capacity of 1 million barrels a day, which may increase to 1.5 million barrels, according to Eni.
source: Hurriyet daily news

Turkish state firm to drill Black Sea in January

meb — Mon, 05 Oct 2009 11:45:13 +0000

Türkiye Petrolleri Anonim Ortaklığı, or TPAO, Turkey’s state oil company, will start drilling for crude oil in the Black Sea in January, Chief Executive Officer Mehmet Uysal said last week.

The company has invested $5 billion in the past 10 years to explore the Black Sea and has identified 10 drilling prospects with capacity to cover Turkey’s consumption for 40 years, Uysal said in an interview in Bucharest.

TPAO has Black Sea exploration agreements with Brazil’s state-controlled Petroleo Brasileiro, and signed a joint operation accord with Exxon Mobil in November.

“The Black Sea has huge reserves, which will be the main supplier of Europe within 10 or 15 years,” Uysal said. “Our modest estimates for those prospects are 10 billion barrels of recoverable oil and 1.5 trillion to 2 trillion cubic meters of gas.”

Once the 10 drilling prospects are proven as oil or gas bearing, TPAO will start production studies, which will take about five to seven years, and by 2017 or 2020 it will start production in those fields, he said.

“Out first aim is to fulfill Turkey’s energy demand,” Uysal said. “Then we will make more investment to expand the fields’ capacity to export to Europe.”

In the next 10 or 15 years Turkey will become a vital energy hub for Europe as an alternative to Russia, from which the European Union now gets a quarter of its natural gas, Uysal said. There are many oil and gas pipeline projects passing through Turkey and “very soon Turkey’s territory will start looking like a spaghetti plate,” he said.

Samsun-Ceyhan pipeline:

The 27-nation EU, which Turkey aspires to join, seeks to reduce its dependence on Russian gas, through projects including the Nabucco pipeline designed to pump gas from the Caspian via Turkey to Europe. Kazakhstan already ships oil through BP’s Baku-Ceyhan link to Turkey’s Mediterranean coast.

Eni, Italy’s biggest energy company, and Turkey’s Çalık Holding plan to build the Samsun-Ceyhan pipeline to carry oil from the Black Sea to the Mediterranean. The project “can be up and running in five to seven years,” Eni Chief Executive Officer Paolo Scaroni said in Bucharest last week.

“In energy terms Turkey is already part of the EU,” Scaroni said. “Turkey is the most important transit country in the region. It is a matter of geography.”
source: Hurriyet daily news

Gazprom plans to invest in Turkish market

meb — Fri, 02 Oct 2009 08:31:24 +0000

Russian natural gas giant Gazprom is eyeing the growing Turkish market, deputy chief executive Alexander Medvedev told business daily Referans, adding that the firm might invest in the natural gas distribution and electricity production markets.

Gazprom aims to build and operate a center with the Aksa Group, a Turkish energy producer and supplier, in order to sell gas directly to Aksa once Turkey changes regulations that prevent such sales, Medvedev said.

Detailing the company’s negotiations with Botaş, the state-owned Turkish pipeline company, Medvedev said a volume discount in the context of the “purchase or pay” model is being discussed, but no official negotiations have started yet over the issue.

“We have reached an agreement on the political aspects of the Blue Stream-2 project,” said Medvedev. Speaking on Gazprom’s plans for the Turkish market, Medvedev pointed toward current legislative problems.

“Supplying gas to private Turkish companies is expected to take place after the change of legislation,” he said. “We hope that Turkey will take care of this problem in the future. Gazprom and Aksa are considering possible cooperation on subjects such as building and operating a natural gas center.”

Botaş had previously requested a change to the “purchase or pay” clause after it faced difficulties selling the gas purchased from Russian in the market.

“We did not reach the level of official negotiations on this issue,” said Medvedev.

Noting that Turkey is the second biggest gas buyer from Russia after Germany, Medvedev said, “The gas that Turkey purchased in 2008 totaled 23.8 billion cubic meters.” As of Aug. 1, Turkey’s purchase will amount to 12 billion cubic meters, he said, adding that Gazprom expects this year’s total purchases to reach the 2008 level.

Gazprom is waiting to obtain permission from the Turkish authorities to start feasibility work for the South Stream project, a natural gas pipeline that will bypass Ukraine and carry Russian gas to southeast and Central Europe through Turkey, Medvedev said. The pipeline is regarded as a rival to the European Union and United States-backed Nabucco project.

“After obtaining the permissions, we will immediately start working in the Black Sea,” he said. “Cooperating with Turkey on natural gas opens many doors. Our cooperation enables us to lengthen long-term agreements,” such as the West Line agreement, which is expected to expire by 2011.

Noting that the Blue Stream project is still in its early phases, Medvedev said: “We have reached a deal with our Turkish partners on political issues. [Now] we will start negotiating the actual issues.”

Medvedev also said it was too early to talk about Gazprom’s potential interest in Botaş if Turkey decides to privatize the company.
source: Hurriyet daily news

Global giant re-invests in Turkish factory

meb — Thu, 24 Sep 2009 07:19:04 +0000

General Electric, or GE, a global media, technology, services and manufacturing company, has begun to invest in future technologies at its engine-parts division in Turkey’s northwestern city of Eskişehir, according to a GE executive.

The firm will produce new compressor-wing technologies only in Turkey, said GE Turkey Managing Director Kürşat Özkan. The investment totals nearly $50 million, he added.

Speaking about the global crisis and its impacts, Özkan said that GE will continue its activities in Turkey. “We have started investing in future technologies here in our Eskişehir division, although there is a capacity surplus in the world. New compressor-wing technologies will be produced only in Turkey.”

The firm has already started developing some of its production technologies in Turkey, he said, adding, “It may not sound reasonable to make such a manufacturing investment in a period marked with demand contraction in the market, but we will have positioned ourselves once the market demand returns.”

An additional building has been built at the current Tusaş Engine Industries factory, he said. “There is not a booming demand at present, but in time this will be the best facility in the world for our product. With all its elements, this investment approaches $50 million. There are long-term projects that we cannot cut. Our activities for train production are ongoing. The European market needs next-generation trains, therefore Turkey may become a strong center for this industry. I predict that the factory will start operating next year.”

Özkan also commented on an engineering center in Gebze, the largest district of the northwestern industrial city of Kocaeli. “This is also a long-term project. We will eventually employ 200 engineers there. Training this many people requires long-term work. We will not make cuts there due to the crisis, since we have to continue our investments by training our staff.”

Replacing business models

Noting that business models based on long-term financing have deteriorated both in developed and developing countries in the aftermath of the global turmoil, Özkan expressed the need to replace them with alternatives.

In such a climate, it would not be realistic to have very aggressive growth targets, Özkan said, adding, “There will be difficult times for a few years worldwide. In the upcoming period, we do not expect to regain the previous situation immediately. But the most-feared period is now over.”

According to Özkan, GE expects a decline in its Turkey revenues this year compared with 2008. However, Garanti Bank, in which GE holds a stake, has performed well despite the climate. “We do not know whether 2010 will be a year of stagnation, but we hope that the worst days are now over,” he said.

Noting that the private sector is advancing in Turkey, Özkan added, “We learn many things from our partners, even in issues that we think we know well. We always take off our hat to Garanti in terms of consumer finance. Garanti is one of the brightest spots among GE’s global investments. We have obtained very good results in all investments and partnerships. That’s because of our capability to find good partners and the opportunities Turkey offers.”

GE is gradually minimizing the share of its GE Capital financial-services division on its balance sheet in the medium term, Özkan said, explaining the firm’s back-to-basics policy in developing countries. “But we will continue to invest in places that have a rare, well-positioned bank such as Garanti. They have a promising future.”

GE takes a cautious stance regarding large investment items and energy investments. Some projects do not seem feasible within current financing parameters, he said, adding that there are some projects that need to wait for both financing and regulatory approval.

Özkan also noted that fields such as energy, transportation and health care will continue to be the most important sectors in Turkey for GE in the post-2012 period. Regarding the issuance of the Renewable Energy Act, GE plans to undertake significant projects in this field, he said. Meanwhile, despite the crisis, the company has not interrupted its investments in research and development as well as hiring.
source: Hurriyet daily news

RWE among possible bidders for grids

meb — Sat, 18 Jul 2009 08:25:20 +0000

Germany’s RWE and EnBW Energie Baden-Wuerttemberg applied to bid for Turkish electricity distribution grids, Turkey’s Privatization Administration, or ÖİB, said in a statement Thursday.

RWE, ENBW and EWE were among 22 applicants who may place bids in a tender for Osmangazi Elektrik Dağıtım, a grid that serves the central cities of Eskişehir and Afyon, the ÖİB said in an e-mailed statement.

EWE may also bid for Yeşilırmak Elektrik Dağıtım, a grid covering northern Black Sea regions, along with 16 other applicants, and was one of 13 possible bidders for Çoruh Elektrik Dağıtım in the northeast of the country.

Akenerji Elektrik Üretim, the Turkish unit of Czech power company CEZ, Çalık Enerji and Zorlu Holding were also among the applicants, the ÖİB said.
source: Hurriyet daily news

Q&A: NABUCCO

meb — Sat, 18 Jul 2009 08:21:00 +0000

Who will pay for the pipeline construction and who will own it?

The estimated cost of the pipeline is 8 billion euros. Thirty percent of this amount will be met by the Nabucco consortium, which is composed of the participant countries’ energy companies, namely Turkey’s BOTAŞ, Bulgaria’s Bulgargaz, Romania’s Transgaz, Hungary’s MOL, Austria’s OMV and Germany’s RWE. The European Investment Bank had pledged to provide 25 percent of the cost and the European Bank of Reconstruction and Development has also promised to contribute to the project, which will be owned by the Nabucco consortium.

What is at stake for the Turkish government and other participating governments?

The Turkish government has sought a “lift-off,” a percentage of the gas in transit. Originally, the government wanted 15 percent of the gas for domestic use or re-export, but has had to withdraw this request. Instead, Turkey will have access to “up to 50 percent of the total gas set aside in a pool,” which can be purchased at a discount. As a transit fee, Turkey will gain around 450 million euros annually. Additionally, as the host of a 2,000-kilometer stretch of the pipeline, more than 10,000 jobs will be created in Turkey.

What is the importance of Nabucco?

Apart from the Baku-Tbilisi-Ceyhan oil pipeline, Nabucco will be only the second project to carry Caspian reserves to Europe from non-Russian territories. This means it will not only reduce the continent’s dependency on Russia, but also that it will, at the same time, tie Turkey closer to the European Union, bringing the country one step nearer to its goal of becoming an energy hub.

How will Nabucco change the global energy game?

Though Azerbaijan appears to be the sole gas supplier to the project at present, in the future it will be open to any third-party bidders. Once the problems over the status of the Caspian are resolved, Turkmenistan may transfer some of its reserves through Nabucco. Iraq has also expressed its intention to take part in the project and Iran may send some of its future gas to Europe if it can normalize its ties with the West. Egypt is also seen as an important future supplier.

Would Nabucco meet European demands?

Nabucco is far from meeting the continent’s growing energy needs on its own. The capacity of the pipeline is 31 billion cubic meters and the EU’s annual gas consumption is predicted to rise to 800 billion cubic meters by 2030. But experts argue that the success of Nabucco would raise the possibility of building Nabucco-2 and even Nabucco-3.

What will happen next?

The signing of the intergovernmental deal will pave the way for the consortium to speed up work on inking the Project Support Agreement. Each participant will sign the accord, which will outline the project’s technical details, a process that will be concluded in six months, according to officials. Then a throughput agreement will have to be concluded to secure the supply and the cost of the gas.
source: Hurriyet daily news

Recent tax hike on fuel boosts budget revenue

meb — Sat, 18 Jul 2009 08:11:23 +0000

The Finance Ministry expects to add some TL 1.4 billion in extra revenue to its coffers thanks to a recent tax hike on fuel. The government announced on Wednesday that the private consumption tax (ÖTV) would increase by Kr 20 for gasoline, Kr 15 for diesel and Kr 10 for liquefied petroleum gas (LPG), sparking outrage from consumers. Fuel distribution companies had to raise their prices on Thursday, bringing further criticism against the government and fuel market regulators. The Finance Ministry expects to take in an anticipated TL 1.4 billion this year from the tax hikes.

Data from the Petroleum Industry Association (PETDER) show that fuel consumption in Turkey was 3 million cubic meters in 2008; this number is expected to decline by roughly 6 percent this year. However, despite the decline, the state will still make a considerable amount of money with the latest price increases. Based on PETDER’s estimation, the Finance Ministry will earn TL 290 million from gasoline, TL 1 billion from diesel and TL 110 million from LPG taxes in the second half of this year.

Alleging that the increasing tax rates have an unfair impact on competition in the market, sector representatives argue that many fuel dealers are facing bankruptcy. In particular, many small distributors are losing strength, and some are closing down their shops. The ÖTV on gasoline makes up 69 percent of the total cost to consumers, 61 percent for diesel and 63 percent for LPG.

Meanwhile, a recent value-added tax (KDV) increase on hotels, holiday resorts and facilities with more than three stars is not expected to bring about a sizeable increase to state revenue.

The KDV on tourism facilities was increased from 8 percent to 18 percent. Oktay Varlıer, president of the Tourism Investors Foundation, said Friday that he did not think this 10-point increase would provide the expected income boost. “Most hotels are still applying last year’s prices for rooms. Hence they stand to lose a lot with this KDV hike. This fact creates unfair competition,” he argued, adding that the government made the decision without consulting hotel managers for their opinion. Varlıer also hinted that sector representatives might appeal to the Constitutional Court, demanding that the KDV hike be repealed.
source: Today’s Zaman

TPAO to explore oil off Turkish waters in Mediterranean

meb — Fri, 17 Jul 2009 18:24:01 +0000

The government has given the go-ahead to the state-owned Turkish Petroleum Corporation (TPAO) to explore for oil in international waters in the Mediterranean Sea for one year.

Ankara’s move in the eastern Mediterranean, off the coast of Cyprus, is likely to stir up the waters since it will probably be interpreted by many as a show of its determination to protect its rights and interests in the region when faced with a unilateral Greek Cypriot move vis-à-vis the exploration.

A governmental decree authorizing the TPAO to explore for oil beyond Turkish territorial waters in the Mediterranean went into effect on Thursday after publication in the Official Gazette. According to the decree, published after Cabinet approval, the regions where the TPAO will launch geological surveys are four separate areas, two in the Antalya Basin and two in the Muğla Basin. The four blocs in total comprise more than 2 million hectares of area. Last month, Greek Cyprus stated that it would press on with offshore oil exploration, despite strong objections from Turkey, and would open new fields for hydrocarbon research by early next year.

Only a few days after this statement, it raised the stakes in the dispute, saying Turkey’s objection would further impede its regional rival’s effort to join the European Union. The first exploration deal by Greek Cyprus was clinched with US company Noble Energy, which has already found a large gas reservoir off the coast of nearby Israel. In response, Ankara urged third parties to use “common sense” in avoiding becoming party to actions that might be harmful to ongoing reunification talks between Greek and Turkish Cypriot leaders, while also expressing determination in protecting its rights in the Mediterranean Sea.

“The Turkish Cypriot people have rights there [in the eastern Mediterranean]. You cannot ignore this. Turkey also has rights and interests there. Our intention to protect them is known by everyone,” Foreign Ministry spokesman Burak Özügergin told reporters last month, when he also labeled Greek Cypriot actions on this issue as “in a word — adventurous.”

In 2007, Greek Cyprus launched its first licensing round for hydrocarbons in 11 offshore blocs, most in deepwater locations, despite objections from Turkey, which militarily intervened in the north of Cyprus in 1974 after a brief Greek-inspired coup. Turkish Cypriots in the north of the divided island say their Greek Cypriot rivals have no authority to explore for oil or gas and have warned that the dispute could upset reunification talks.

In November of last year, EU member Greek Cyprus protested to the United Nations that Turkish warships had repeatedly harassed Norwegian research vessels off the southern rim of the island over blocs earmarked for exploration. Turkey, which lies north of Cyprus, said the research ships had encroached on its continental shelf.
source: Today’s Zaman