SOCAR Turkey Energy to Purchase Stake in TANAP
SOCAR Turkey Energy, the Turkish unit of the State Oil Company of the Azerbaijan Republic (SOCAR) has indicated that it plans to acquire a 7 percent stake in Trans Anatolian Gas Pipeline (TANAP),
Kenan Yavuz, CEO of SOCAR Turkey Energy, told reporters that this company would purchase the shares in TANAP held by SOCAR, which would then reduce SOCAR stake in TANAP to 51 percent.
SOCAR has already announced that it does not intend to decrease its stake in TANAP to less than 51 percent.
Responding to a question from Natural Gas Europe as to why SOCAR wishes to sell its share to its own subsidiary company, Yavuz said that it was because of two reasons: "Decreasing SOCAR's expenditures and increasing SOCAR Turkey Energy's influence in Turkey".
He said that purchase of 13 percent stake in of SOCAR Turkey Energy by the US-based investment banking firm Goldman Sachs for $1.3 billion in mid-August 2015, indicates that this company's worth is about $10 billion in total.
The largest industrial investor in the country with a portfolio size of USD 20 billion, SOCAR Turkey is the majority shareholder of Turkey’s largest petrochemicals maker Petkim as well as the soon-to-be-operational container port Petlim and Star Refinery, under construction in Izmir’s Aliaga district.
“This partnership underscores the strong confidence in Turkey and in SOCAR Turkey, which is on track to become Turkey’s second largest holding once the Star Refinery and related projects are completed by 2018”, Yavuz said in a statement on the Goldman Sachs transaction on August 16th.
The Azeri company’s largest investment in Turkey, the USD 5 billion Star Refinery, will significantly reduce the country's dependency on the imports of petroleum derivatives when it reaches operational stage in 2018.
TANAP project envisages transportation of gas of Azerbaijan’s Shah Deniz field from the Georgian-Turkish border to the western borders of Turkey.
TANAP’s initial capacity is expected to reach 16 billion cubic meters of gas per year. Around six billion cubic meters of this gas will be delivered to Turkey and the rest of the volume to Europe. Turkey will obtain gas in 2018, while deliveries to Europe will get iin early 2020 after the Trans Adriatic Pipeline (TAP) is constructed.
BP and the TANAP consortium signed a shareholder agreement March 13, according to which BP will become one of the shareholders of TANAP. The agreement is one of the main documents for BP’s ownership of a stake in the TANAP project.
Following the completion of a legal implementation procedure, TANAP’s shareholders list will be as follows: SOCAR and units – 58 percent, Botas – 30 percent and BP – 12 percent.