Putin’s Turkey visit brings S-400 missile and nuclear plant headway

Putin’s Turkey visit brings S-400 missile and nuclear plant headway
Western powers are anxious at how warm strategic relations are becoming between Turkey and Russia. Erdogan (left) and Putin are pictured in Ankara on April 3.
By bne IntelliNews April 4, 2018

Turkish President Recep Tayyip Erdogan received Russian counterpart Vladimir Putin in Ankara on April 3 with a crowded agenda to tackle including the building of Turkey's first nuclear power plant, the purchase of the Russian S-400 missile defence system and progress with the TurkStream natural gas pipeline.

Discussions were set to become even more challenging on April 4 with the scheduled arrival of Iranian President Hassan Rouhani and the need to deal with the complicated task of finding an end-game for the conflict in Syria—both Russia and Iran are forceful supporters of the current Syrian regime under President Bashar al-Assad, while Turkey is one of Assad's biggest opponents. Western powers worried that a triumvirate of Russia, Turkey and Iran could gain a stranglehold on crucial moves in the Middle East may be persuaded that the differences over Syria will prove an insurmountable hurdle.

However, in terms of the order of business on April 3, Western anxieties over Nato member Turkey's growing closeness to the Kremlin will have been most stoked by Erdogan and Putin marking the official start of work to build Turkey’s first nuclear power station—with the launching of the construction of the $20bn Akkuyu plant in the southern province of Mersin—and the Russian president's declaration that a contract to supply the S-400 defence hardware to Turkey is a priority in military cooperation between Moscow and Ankara and would be speeded up. Turkey’s relations with Russia all but collapsed in 2015 when the Turks shot down a Russian fighter-bomber near the Syrian border, but there has been a strong rapprochement since then. That was underlined by Turkey remaining one of the few Nato partners that did not expel Russian diplomats in response to the nerve agent attack against the Skripals in the UK in March.

Erdogan told a news conference that Turkey may cooperate with Russia on defence projects besides the S-400 missile system, though he did not give any further details. There have been some signs that the US may try to block the S-400 deal, perhaps by refusing delivery of F-35 warplanes to Turkey if it goes ahead or by threatening sanctions. The system cannot be integrated into Nato's military architecture.

Official construction start for nuclear plant
The Akkuyu nuclear plant is to be built by Russian state nuclear energy agency Rosatom, with four units to each offer a capacity of 1,200 megawatts. Putin and Erdogan watched the official start of construction from Ankara via a video link.

“When all four units go online, the plant will meet 10% of Turkey’s energy needs,” Erdogan said. That would be a boon to Turkey which, short of substantial oil and gas resources, is plagued by high energy import bills. Despite delays with Akkuyu, Turkey says the project is still on target to start generating its first power in 2023. However, Erdogan said the cost of the project may move beyond the planned $20bn. A big project cost overrun might mar Erdogan’s “2023 vision” created to commemorate 100 years since the founding of modern Turkey.

Speaking during the Akkuyu construction launch ceremony, Putin said: "We are starting the creation of a new industry. Turkey is a highly developed state in terms of technology and economy, but this is a new stage, a new step in the development of the economy of the Turkish Republic."

Russia was awarded the contract to build the nuclear plant in 2010, but the project has been hindered by multiple delays.

Last month, sources familiar with the matter told Reuters that Akkuyu was likely to miss its 2023 target start-up date, but Rosatom, searching for local partners to take a 49% stake in the investment, said it is sticking to the timetable.

Turkish companies are wary of the size of the financing required and are worried they will not obtain a sufficient share of the lucrative construction side of the deal, two industry sources told the news agency.

Interfax news agency, meanwhile, cited Rosatom as saying the sale of the Akkuyu stake is probably set for a postponement from this year to 2019.  

TurkStream awaiting onshore permit 
Also on April 4, Russian Energy Minister Alexander Novak said Turkey’s approval for Gazprom’s onshore portion of the TurkStream gas pipeline’s second line, which is to run from Russia to Turkey via a route under the Black Sea, is still pending.

“As for the onshore part, this is now at the discussion stage... the companies are discussing the protocol,” Novak told reporters.

All permits for the offshore part of the pipeline had been issued and it remained under construction, he added.