SOCAR-Turkey: Winner of tender for STAR refinery to be determined at year end

Oil&Gas Materials 15 December 2012 12:25 (UTC +04:00)

Azerbaijan, Baku, Dec.15 /Trend R.Hafizoglu/

Winner of the tender for STAR refinery will be defined at year end, head of SOCAR-Turkey Enerji A.Ş. Kenan Yavuz said, TV CNBCE reports on Saturday.

The head of the company said currently serious preparations are being held.

"All the investments in the refinery in Izmir can be considered as an important contribution to the country's energy sector," Yavuz added.

Some $6 million will be directed for the construction of the oil refinery. This will be financed partly through shareholders (30 per cent), which is about $1.8 billion and the rest through bank loans.

Annual production of naphtha which is used as the primary Petkim raw material will be 1.66 million tons in STAR. Currently, more than 80 per cent of the needs of Petkim in naphtha are met through imports whose dependence will be reduced to zero after the opening of the new refinery.

Exemption from value added tax and customs duties is provided in the frame of the project. Overall, a tax simplification up to 90 percent is planned, and the government will ensure VAT return during the construction of a plant.

Turkey will also pay the minimum amount of insurance to employees of refinery during seven years and will allocate $50 million (five percent of the total) as an aid in the payment of interest.