mahatir
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High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. Turkey-Azerbaijan: ties that bind | beyondbrics
The Azeri dialect of Turkish may sound strange to Turkish ears but it is perfectly intelligible and the increasing economic and political cooperation between the two states represents as much a common culture as the geographical imperative that makes Turkey the perfect export route for Azerbaijans sizeable reserves of oil and gas reserves.
The latest example of Turkish-Azeri cooperation came with the signing Monday of a $3.4bn EPC contract between Azeri state oil company Socar and its Turkish partner Turcas and a consortium led by Spains Tecnicas Reunidas for the construction of a 10m tonnes/yr refinery at Aliaga on Turkeys Aegean coast.
Owned 81.5 per cent by Socar and 18.5 per cent by Turcas, the STAR refinery is being constructed on a site adjacent to Turkeys former state petrochemical firm Petkim which is now owned by Socar and is slated to start producing by autumn 2017.
Originally conceived to process Azeri crude arriving at Turkeys Mediterranean oil hub of Ceyhan into primarily naphtha feedstock for Petkim, the plants design was later expanded to allow it to process all regional crudes and to produce low sulphur diesel, jet fuel and other products for local and regional markets.
According to Socar Turkey CEO Kenan Yavuz, the new refinery should cut as much as $2.5bn off Turkeys current import bill for refined products a significant contribution to cutting Turkeys current account deficit.
Also speaking at the signing, Vagif Aliyev, Socars head of international investments pointed out that at an expected final cost of $4.8bn-$5bn, the STAR refinery is currently the biggest FDI project in Turkey.
But, he added, this is only a fraction of the $17bn the company plans to invest in Turkey by 2018, with Socar also planning further investments in Petkim and the planned Trans Anatolian Gas Pipeline (TANAP) being developed by Turkey and Azerbaijan to carry Azeri gas to Turkey and on to markets in Europe.
Aimed at carrying gas initially from Azerbaijans Shah Deniz gas field, current plans foresee TANAP being constructed by 2018, supplying initially 6bn cu m/yr of gas to Turkey with a further 10bn cu m/yr going for export to Europe, later to be increased to 25bn cu m/yr.
The BP led consortium which is developing the Shah Deniz field is expected to decide next month which of two competing pipeline projects will connect with TANAP on Turkeys European borders to carry the Azeri gas to markets in Europe
Turkey-Azerbaijan: ties that bind | beyondbrics
The Azeri dialect of Turkish may sound strange to Turkish ears but it is perfectly intelligible and the increasing economic and political cooperation between the two states represents as much a common culture as the geographical imperative that makes Turkey the perfect export route for Azerbaijans sizeable reserves of oil and gas reserves.
The latest example of Turkish-Azeri cooperation came with the signing Monday of a $3.4bn EPC contract between Azeri state oil company Socar and its Turkish partner Turcas and a consortium led by Spains Tecnicas Reunidas for the construction of a 10m tonnes/yr refinery at Aliaga on Turkeys Aegean coast.
Owned 81.5 per cent by Socar and 18.5 per cent by Turcas, the STAR refinery is being constructed on a site adjacent to Turkeys former state petrochemical firm Petkim which is now owned by Socar and is slated to start producing by autumn 2017.
Originally conceived to process Azeri crude arriving at Turkeys Mediterranean oil hub of Ceyhan into primarily naphtha feedstock for Petkim, the plants design was later expanded to allow it to process all regional crudes and to produce low sulphur diesel, jet fuel and other products for local and regional markets.
According to Socar Turkey CEO Kenan Yavuz, the new refinery should cut as much as $2.5bn off Turkeys current import bill for refined products a significant contribution to cutting Turkeys current account deficit.
Also speaking at the signing, Vagif Aliyev, Socars head of international investments pointed out that at an expected final cost of $4.8bn-$5bn, the STAR refinery is currently the biggest FDI project in Turkey.
But, he added, this is only a fraction of the $17bn the company plans to invest in Turkey by 2018, with Socar also planning further investments in Petkim and the planned Trans Anatolian Gas Pipeline (TANAP) being developed by Turkey and Azerbaijan to carry Azeri gas to Turkey and on to markets in Europe.
Aimed at carrying gas initially from Azerbaijans Shah Deniz gas field, current plans foresee TANAP being constructed by 2018, supplying initially 6bn cu m/yr of gas to Turkey with a further 10bn cu m/yr going for export to Europe, later to be increased to 25bn cu m/yr.
The BP led consortium which is developing the Shah Deniz field is expected to decide next month which of two competing pipeline projects will connect with TANAP on Turkeys European borders to carry the Azeri gas to markets in Europe
Turkey-Azerbaijan: ties that bind | beyondbrics