SOCAR purchases large power plant in Turkey for $225 mln - Azerbaijani PM

BAKU. Dec 22 (Interfax) - SOCAR Turkiye, the Turkish subsidiary of the State Oil Company of the Azerbaijani Republic (SOCAR), will acquire a combined-cycle power plant in Turkey located in Central Anatolia for $225 million.

"The State Oil Company of the Azerbaijani Republic intends to acquire the Gama Enerji Ic Anadolu power plant with a capacity of 870 MW in Turkey for $225 million. The deal will be concluded on December 23 at the Azerbaijan-Turkey Investment Forum in Baku," Azerbaijani Prime Minister Ali Asadov said at a meeting of the Azerbaijan-Turkey joint intergovernmental commission.

SOCAR Turkiye will become the owner of a 100% stake in Gama Enerji Ic Anadolu, he said.

It was reported in May this year that the Turkish company Gama Enerji A.S., the owner of the power plant, received a non-binding offer from SOCAR Turkiye to purchase this asset for $225 million to $250 million and expressed readiness to continue negotiations. It was noted that acquiring the plant would allow SOCAR to strengthen its position in the growing Turkish electricity market and would become an alternative method of monetization in conditions of oversupply.

For Gama Enerji, whose portfolio also includes hydro and wind power plants, a potential sale would mean exiting gas-fired generation - a sector with limited profitability due to regulated tariffs.

SOCAR Turkiye Enerji is the owner of a controlling stake (51%) in Petkim Petrokimya Holding. The company also built the STAR oil refinery, a container terminal and a power plant in Turkey, and supplies gas to the domestic market and petroleum products to aircraft refueling points at airports in several major Turkish cities.