Russia’s Rosatom selling 49% in $20bn Akkuyu nuclear project to Turks

Russia’s Rosatom selling 49% in $20bn Akkuyu nuclear project to Turks
Though a nuclear giant in Russia - it runs all the nuclear assets of the Russian Federation - Rosatom is not going it alone in Turkey.
By bne IntelliNews June 19, 2017

Russia's Rosatom plans to sell a 49% stake in the $20bn Akkuyu nuclear power plant project to Turkish conglomerate Cengiz-Kolin-Kalyon and was set to sign a preliminary deal to that effect on June 19, the head of Rusatom Energy International said according to Reuters.

Turkey’s energy market regulator EPDK on June 15 granted a 49-year generation licence to Rosatom for Akkuyu, expected to be completed by 2023 with the capacity to meet 6-7% of Turkey's electricity demand.

Anastasia Zoteyeva, head of Rusatom Energy International, speaking on the sidelines of a nuclear conference in Moscow, said an agreement with Turkish investors should be signed by the end of this year, Reuters added.

The project is to be financed by Rosatom and its partners and will make use of loans from export-import agencies and banks, Anastasia Polovinkina, director of Rusatom's finance and investment analysis department told the conference, the news service also reported.

Turkey commissioned Rosatom in 2010 to build the nuclear power plant in a project that will cover the construction of four power units with a capacity of 1,200 MW each.

Reuters quoted on April 27, 2016 unnamed sources as saying that Rosatom was in talks with Turkish contractor Cengiz Insaat for the sale of the 49% minority stake in Akkuyu nuclear power plant project due to economic problems in Russia.

Cengiz-Kolin-Kalyon is part of the Cengiz-Kolin-Limak-Mapa-Kalyon consortium which won a tender to construct and operate Istanbul's third airport for 25 years with a €22.15bn offer – a Turkish record. The companies have taken part in some of the Turkish government’s other leading infrastructure projects.

Turkey’s heavy reliance on imported energy is forcing it to seek to diversify its energy resources, including nuclear. Thanks to lower prices, Turkey’s energy import costs declined by 28.2% y/y to $27.2bn last year, but across January-April this year they surged nearly 38% y/y to $11.7bn.

Tensions between Ankara and Moscow that came to the fore after Turkey shot down a Russian fighter-bomber jet in November 2015 near the Syrian border prompted Russia to announce a raft of economic sanctions against Turkey. The friction also placed the Akkuyu project in jeopardy, with Rosatom halting construction activities at Akkuyu.

But, as a result of a rapprochement process, Moscow has lifted many of the restrictions it imposed against Ankara, and relations between the two countries have improved considerably over the past couple of months.