BUSINESS

Korea, Turkey to sign MOU on $2b power plant

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  • Published : Feb 5, 2012 - 20:00
  • Updated : Feb 5, 2012 - 22:39


ISTANBUL (Yonhap News) -- South Korean firms will sign a preliminary agreement to build a thermal power plant in southern Turkey on the sidelines of President Lee Myung-bak's trip to the Eurasian nation, officials said Sunday.

A consortium of SK E&C and the state-run Korea South-East Power Co. will sign a memorandum of understanding Monday with Turkey's state-run Electricity Generation A.S. on the $2 billion first-phase project to build a coal-fueled power plant in the Afsin-Elbistan region, some 600 km south of Ankara, officials said.

The energy ministers of the two countries will attend the signing ceremony, they said.

The project calls for refurbishing existing four power-generating units with a combined capacity of 1,355 megawatts and building two more units with a total capacity of 700 megawatts, officials said.

The second-phase project, worth $9 billion, calls for developing three coal mines and building three power plant units each capable of generating 1,400 megawatts. Depending on the outcome of the first-phase project, Korea could also win the second-phase project.

Turkey has seen its electricity demand soaring in tandem with its fast economic growth. The country has been one of the world's fastest-growing economies despite global economic downturns. Turkey, which has rich coal resources, gets more than 73 percent of its power from thermal power plants.

Officials said Turkey hopes to award the project to Korea without any bidding process in recognition of Korea's advanced power plant construction technologies.

The Korean consortium is expected to conduct a feasibility study and submit a final proposal between February and September before the two sides conclude an inter-government agreement and a main contract, officials said.