InterGen, Enka complete US$1.5 billion financing for projects in Turkey
InterGen and its Turkish partner Enka today announced the loan signing of the Gebze, Adapazari and Izmir natural gas-fired power facilities in Turkey. Taken together, the total financing of US$1.5 billion for the three facilities represents one of the largest private sector greenfield power project financings ever completed, said Carlos Riva, InterGen's president and CEO.
InterGen and Enka expect the total project cost to be more than US$2 billion. The Gebze (1,555 MW), Adapazari (780 MW) and Izmir (1,525 MW) facilities, Riva said, represent the largest private sector power investment yet in Turkey and equate to a 15% increase in Turkey's electrical generating capacity.
The power stations are the first to proceed under Turkey's new build, own, and operate (BOO) program. The Izmir project is located in Aliaga, near the city of Izmir. The Adapazari and Gebze power projects are located 150 km east of Istanbul.
Limited recourse facilities from the U.S. Export-Import Bank (Ex-Im), Overseas Private Investment Corporation (OPIC), Hermes of Germany, OND of Belgium and a commercial bank facility have been arranged. Co-arrangers ABN AMRO, BNP Paribas, Societe Generale and Westdeutsche Landesbank plan to provide the underlying funding for the export credit agency facilities as well as the commercial bank facility.
The OPIC facility receives funds through OPIC direct loans to each of the projects and will be used to finance costs that are ineligible for export credit agency cover, Riva said. Finansbank of Turkey plans to provide letters of credit facilities to the projects.
BOTAS, the Turkish state-owned gas company, plans to supply natural gas to all three facilities, which will be built by Bechtel Power and Enka. Construction of the Gebze, Adapazari, and Izmir facilities started earlier this summer, and InterGen and Enka expect them to enter full commercial operations in 2002.
GE plans to supply the combustion turbines and provide long-term maintenance. Alstom plans to supply the steam turbines out of Germany, and CMI plans to provide the waste heat boilers from Belgium.
"With the Build Own Operate framework, the Turkish Government and Turkish Electricity Generation and Transmission Corporation (TEAS) demonstrated a commitment to solving Turkey's energy challenges," Riva said. "We responded by developing projects that will be low cost and environmentally advanced. We look forward to a long-term presence in Turkey's power sector."
According to Sinan Tara, Enka's president, the adjacent Gebze and Adapazari facilities should produce significant related economic activity in the region. The Adapazari area was one of the regions severely affected by the 1999 Marmara earthquake. Enka, InterGen and Bechtel, he said, have all played an active role in responding to the earthquake.
They have been active in areas ranging from rescue and medical missions to municipal support and the establishment of a free boarding school for children who lost their families or homes in the earthquake.
Tara said Enka expects the Izmir plant to facilitate the development of gas delivery infrastructure to Turkey's Aegean coast.
InterGen's power generation portfolio includes 13 power plants—either in operation or being built—that represent 10,350 MW. It also has secured contracts, bid awards or governmental mandates for power stations representing an additional 6,755 MW.
The company operates in the United Kingdom, the Philippines, Colombia, Mexico, China, Egypt, Turkey, Brazil, Australia and Turkey, and is developing projects across the globe. InterGen (www.intergen.com) is a Shell-Bechtel joint venture.
Founded in 1957, Enka—one of Turkey's largest construction firms—employs 14,000 employees in projects in Turkey, Croatia, Russia, Kazakhstan, Azerbaijan, Ethiopia, and North Africa. Enka (www.enka.com) has played a major part in building existing TEAS power stations and BOTAS pipeline infrastructure since the early 1970s.
Edited by April C. Murelio
Managing Editor, Power Online