The US’ Overseas Private Investment Corporation (OPIC) has agreed to support the construction of a $520 million, gas-fired thermal power plant at Ereglisi on the Sea of Marmara. A letter confirming the US government’s commitment to provide $285 million in financing and political risk insurance to the project was signed in Istanbul on 17 October by OPIC president Ruth Harkin.
A financing protocol for the build-operate-transfer (BOT) plant was reached with the government in June (MEED 8:7:94). The project has two US sponsors, the Enron Corporation and Wing International. Other shareholders in the scheme include the UK’s Midlands Generation, and the local Gama Endustri Tesisleri Imalat & Montaj together with its subsidiary Gama Sanayi Zirai Ticaret & Pazarlama. The shareholders have formed a joint-stock company called Trakya Elektrik Uretim & Ticaret. The group is being advised by the US’ Bankers Trust with Kidder Peabody of the UK.
The remainder of the financing will come from export credits covered by Germany’s Hermes and equity contributions from the project partners. Although the assembled financing could meet all anticipated construction costs, there will be an opportunity for commercial financing. The protocol also envisaged a stand-by facility from the commercial markets totalling about $52 million, much of which would be reserved for cost over-runs.