Soma Basin Coal Reserves in Energy Generation Seminar Follow-up, TurkishWeekly

Dear Energy Professional, Dear Colleagues

On 16-17-18 April 2009, we were in Soma coal mine and thermal power plant premises to participate "Soma Basin Coal Reserves in Energy Generation" Seminar, which was organized by Chambers of Mining, Mechanical, Chemical and Electrical Engineers of Turkey.

Our workshop agenda covered the following key subjects

- Coal, its importance in Turkish Energy Politics,
- Turkish Local energy resources, renewable potentials
- Coal mine regional site planning
- Economics of Soma Coal Reserves,
- Coal preparation, Enhancing, Selective Mining,
- Recultivation of coal fields, Plant Recovery
- Coal gasification at site, underground in the mine field
- Coal gasification and liquefaction, above ground
- Applicable Coal firing technologies,
- Assessment of existing indirect pulverized coal firing
- New Coal firing technologies, Circulating Fluidized Bed,
- Integrated gasification combined cycle, applications
- Flue gas desulphurization, e/p dust collectors,
- New High Voltage Power transmission applications,

We had also a site tour on the last day for the interested parties.

We all know that one of the most important electric power generation projects are in Soma Lignite region where one of the largest lignite mines are located in Turkey. Available coal in various coal mines in the Soma basin has a challenging content with relatively poor low calorific value at ranging about average 3335 and 1500 kcal per kg LHV respectively. Sulphur content is around 1% in both coal mines.

Soma plant has a comfortable and safe design. It has proven its design in the last 20 years of difficult operation. But due to low, uncontrolled and fluctuating incoming coal quality for long period of public mining, plant has signs of high level of degrading, aging, wear and tear.

On the other hand, Plant has insufficient dust emission equipment. Existing E/Ps (Electrostatic Precipitators) are not capable of collecting outgoing dust.

There is also no FGD (Flue Gas Desulphurization) unit to collect the sulphur in exit gas. Gas emissions are intolerable levels at exit, based on EU norms and Kyoto regulations.

Water consumption in water cooling systems is very high compared to prevailing norms. That reduces the water needed for the nearby agricultural activities. High level of water pollution is apparent in the outgoing creeks which are used as the natural sewage of the plant.

Although humble writer is not so comfortable with the concept due to high level of the human cost and sacrifice, nevertheless privatization seems to be the only viable solution to the current rehabilitation financing and environmental problems in the long term.

Your writer fees quite qualified to evaluate the current situation since he participated to early consultations at the buyer side of the negotiation table in year 2000. That year, plant was in TOR (Transfer of Operational Rights) scheme which was a sort of leasing the plant operation for next 49 years. Winning price was 255 million US Dollars plus commitment to make additional expenses for necessary plant upgrading, adding new E/Ps and FGDs.

Local winning party had invited international operator companies including but not limited to CSWI and AEP of USA, Tractebel of Belgium, Enron UK. They came to the plant in big teams and inspected the site as well as the legal and commercial terms to assess the risks. Since the apparent risks were too high they turned down the partnership invitations. Later in time governing body decided to cancel the scheme. The local private party applied to international arbitration and won the compensation to receive 35 million US Dollars.

Your writer feels obliged to share his past experience in risk assessment of the project with the interested readers. Local financial institutes as well as local investors are advised to get better positioned for possible privatization of the plant in future.

We were very pleased to join/ support/ contribute to the event, hope to organize similar events in the international platforms in the future.

Haluk Direskeneli, Ankara based Energy Analyst