Massive Chinese bank funding energy projects in Turkey
THE INDUSTRIAL and Commercial Bank of China (ICBC), one of the world’s largest banks, will provide a $3.6-billion loan package for Turkey’s energy and transportation sectors, Treasury and Finance Minister Berat Albayrak said Thursday. “The $3.6 billion loan package from Chinese financial institutions for energy and transportation sector investments – private sector, public institutions and banks – has been approved,” Albayrak said on his official social media account. The minister added that negotiations during his visit to China were “fruitful.” Earlier in May, Albayrak visited a number of institutions in China and held a number of key meetings with Chinese representatives, including the ICBC.
ALBAYRAK also met officials of the State Power Investment Corporation (SPIC), State Nuclear Power Technology Company (SNPTC), China’s National Energy Administration (NEA), Chinese Atomic Energy Authority (CAEA) and State Grid Corporation of China. Turkey’s state-owned Petroleum Pipeline Company (BOTAŞ) and ICBC signed Thursday a memorandum of understanding (MoU) to finance - $1.2 billion with a maturity of 15 years - in capacity increase projects at the Silivri and Lake Tuz Natural Gas Storage Facilities, which will be able to store 20 percent of Turkey’s annual natural gas consumption.
According to the agreement, a third of ICBC’s $3.6 billion financing package for Turkey will be allocated to natural gas storage investments, including at Silivri and Lake Tuz Natural Gas Storage Facilities. Support provided as a project loan will have a maturity of 15 years, with no grace period for the first five years. The capacity of the Lake Tuz Natural Gas Storage Facility, which was inaugurated last year, will increase from 1.2 billion cubic meters to about 5.4 billion cubic meters in the medium term following the expansion works. Likewise, the capacity of Silivri facility, which can store 2.8 billion cubic meters of gas, will be increased to 4.6 billion cubic meters. By 2023, both natural gas storage facilities will have a total capacity of 10 billion cubic meters, about 20 percent of Turkey’s annual natural gas consumption.