---------------------------- Original Message -------------------------
Subject: World Bank Supports Turkey Gas Sector Development
From:    mvandyck@worldbank.org
Date:    Tue, November 29, 2005 3:58 pm
To:      contact@lightmillennium.org
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Washington, November 29, 2005--The World Bank approved today a loan of US$325 million to support a Gas Sector Development Project for Turkey. Boru Hatlari ile Petrol Tasima A.S. (BOTAS) will be in charge of the overall implementation of the project.

The project's main objective is to increase the reliability and stability of the gas supply in Turkey by putting into place critically needed gas storage and network infrastructure, and supporting BOTAS in strengthening its operations as a financially stable and commercially managed corporation. The project has two components:

1) Tuz Golu underground gas storage facility: The gas storage facility will be located in an underground salt formation close to Tuz Golu, a salt lake in South Central Turkey. The facility, upon completion, will have a storage capacity of about 960 million cubic meters of working gas and 460 million cubic meters of cushion gas (the portion of gas which is required to remain in the cavern to maintain its integrity).  The facility will have the capacity to deliver 40 million cubic meters of gas per day up to 20 days and can be refilled at the rate of 30 million cubic meters per day over a period of 25 days.

2) Network Expansion: The project will also finance two compressor stations for BOTAS at Erzincan and Corum as well as other network infrastructure. These stations are required to help transmit the increasing volumes of gas expected to be imported into Turkey from existing and new sources. The Corum station will have a capacity of 30 MW and is required in order to enable increased supply from Russia, while the Erzincan Station will have 39 MW of compression capacity and will enable the import of natural gas from Azerbaijan.

"The World Bank is pleased to help the Government of Turkey in building the first gas storage facility in the country," said Andrew Vorkink, Country Director for Turkey. "The energy sector, and particularly the natural gas sector, is a key driver in Turkey's economic recovery. Natural gas consumption has grown rapidly in Turkey over the past two decades -- with an average annual growth rate of 24 percent. Considerable amounts of environmentally friendly and less costly natural gas are used in industry, commerce and increasingly, households; therefore, storage of gas in the country is extremely important.

"Natural gas storage facilities constructed under this project will help keep the cost of natural gas more stable across the seasons, give better security of supply, and encourage the construction of gas distribution networks," Vorkink continued.  "...Also, due to its unique geographical location, Turkey is well-placed to be a major gas transit country, exporting into mainland Europe. This role for Turkey as a transit country is likely to drive the economics of the natural gas market in the medium term."

The lending instrument for the Gas Sector Development Project is a Fixed Spread Loan (FSL) with a 7-year grace period and a 13-year final maturity.

For more information about the World Bank's work in Turkey, visit: http://www.worldbank.org.tr

For more information about this project, visit:
http://www.worldbank.org/projects

E-mails:
In Ankara
Tunya Celasin: Tcelasin@worldbank.org

In Washington
Miriam Van Dyck: Mvandyck@worldbank.org

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Posted by Bircan Ünver
http://www.lightmillennium.org
Date: December 5, 2005 - Istanbul