Monday, November 19, 2007

Afsin-Elbistan Thermal Power Plants tender

Istanbul- AA- Electricity Generation Company (EUAS) Director-General Mr. Sefer Bütün announced yesterday in an interview with Anatolia news agency that a tender for the tender to build and operate the Afsin-Elbistan thermal power plants C and D has been rescheduled; the previous tender was called off due to a legal ambiguity.

EUAS has announced that the tender process for Afşin-Elbistan plants C and D will be renewed and provisional clauses have been inserted into the Law on Establishment and Management of Nuclear Power Plants and Sale of Energy to eliminate the ambiguity in electricity purchase that previously derailed the privatization process. A long-delayed bill vetoed by former President Ahmet Necdet Sezer was passed by Parliament on Nov. 9 to help avert an energy shortfall. The amendment made in the law foresees that expropriation of power plants be carried out, not by the company that becomes preferred bidder in the tender, but by EÜAŞ itself.

Mr. Bütün said: “We have eliminated any ambiguity stemming from the Law on Establishment and Management of Nuclear Power Plants through two provisional clauses. The law will be published in the Official Gazette as soon as it is approved by President Abdullah Gül. We have completed all preparations to announce the tender process in 10 days, following the law’s publication in the Official Gazette. We expect the power plant to arouse significant interest among many investors across the country.”

Mr. Bütün said that the expropriation of the power plants, which is expected to cost around $400-500 million, will be carried out by EÜAŞ. The Turkish Electricity Trading and Contracting Co. (TETAŞ) pledges to purchase the electricity produced by the winning company for 15 years. A contract will be signed between the bidding company and TETAŞ to this end.

The land surrounding the Afşin-Elbistan thermal power plants C and D, contains coal reserves of 680 million tons at each site and will be given to the winning company in return for a redevance, in which the company will hand in an agreed amount of coal to the state as license fee for a certain period of time.

With this system, the investor will also have a guaranteed coal supply at a suitable cost to run the power plants for 30 years. Bütün also noted that the company that offers the highest amount of electricity, or highest amount of money in exchange for electricity, and which pledges to complete the construction of the power plant in the shortest time possible will be the preferred bidder in the tender. AA


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