Mitsubishi, Kellogg In Shell'S Turkey Project

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Last Updated : Aug 26 1996 | 12:00 AM IST

Representatives from the Shell International Gas in London and the Shell Companies in Turkey, together with representatives from Mitsubishi Corporation and the M W Kellogg Company recently met the Minister of Energy, Recai Kutan, it said.

The statement, a second news release from the company since Friday's announcement of its plans for the project, said the three companies asked the ministry for permission to carry out a feasibility study for an LNG (liquefied natural gas) terminal and a power plant on a coastal site in Turkey.

The first statement did not identify the two other companies involved in the project, estimated at about $2.4 billion.

Both statements fell short of clarifying what stake the companies would have in the deal.

The Turkish arm of the Anglo-Dutch oil giant said on Friday it had applied to the energy ministry to build an LNG terminal and power plant complex that would have a total power capacity of 2,000 megaWatts (MW).

We have expressed our intention to the energy ministry to build an LNG terminal and a power generation unit with a total capacity of 2,000 MW, the first statement said.

The first power unit will be of 650 to 700 MW capacity.

Energy ministry officials, currently studying the deal, said the investment must be approved by the government.

Turkish officials earlier said they welcomed the move by Shell as a return of foreign confidence to a country hit by political and economic instability over the past year. The Shell investment intention shows the level of confidence in Turkey from foreign investors, said a senior energy official.

A nine-month political crisis in Turkey ended in June when the election-winner Islamist Welfare Party (RP) and conservative True Path Party (DYP) set up a coalition to tackle the nation's political and economic ills.

Turkey, in urgent need of electricity, has been seeking ways of securing electricity imports to solve a power shortage problem expected to hit the country from later this year.

The Shell-led project will be the second plant to use LNG to produce power in Turkey. Several European and Japa-nese companies will build stages of a 480-MW gas-fired plant at Marmara Ereg-lisi, 150 km west of Istanbul.

Turkey consumes about nine billion cubic metres of imported natural gas, including LNG equivalent to two billion cubic metres imported from Algeria and processed at Marmara Ereglisi.

Last week Turkey struck a $23-billion deal to buy gas from Iran for 23 years from 1999 through a pipeline to be built from Tabriz to Ankara.

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First Published: Aug 26 1996 | 12:00 AM IST

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