Turkey, China in talks over $10-12B coalfield and power plant project, says Energy Minister
A $10-12 billion investment deal is on the table between Turkey and China for the Afsin-Elbistan coalfield and power plant project in south Turkey, Energy Minister Taner Yildiz said, as reported by Reuters.
Turkey originally signed a deal with Abu Dhabi National Energy Co. in early 2013 to develop its coal resources but that fell through later in the year. Turkey plans to reduce its natural gas imports and expand the use of its vast coal resources for power generation as the country’s economic growth is creating more demand for electricity. There is no certain timetable on a deal with China.
According to Reuters, the Afsin-Elbistan region holds up to 45 percent of Turkey's lignite reserves and the project includes the construction of an 8,000 megawatt (MW) coal-fired plant.
As gas prices track oil prices, the cost of Turkeys rapidly rising imports of gas has put pressure on the country's balance of payments, One analyst noted that an extra $10 a barrel on the oil price "adds about $4bn a year to Turkey’s import bill,” according to SourceWatch. As a result government incentives for new gas-fired power stations have been scrapped and instead switched to encourage new coal-fired power stations.