CHINA Energy Engineering Corporation Ltd (CEEC) has announced that its subsidiary China Gezhouba Group International Engineering Co Ltd has entered into a US$1.5 billion design, procurement and construction contract for a pumped storage power plant in Turkey.
Hong Kong Stock Exchange listed CEEC released the statement to the exchange on March 25.
Under the contract, Gezhouba International Engineering will design and build the Egirdir Pumped Storage Power Station Project, located 25 kilometres northeast of the capital of Isparta Province.
The project will have four pumped-storage generating units of 250MW each. The statement says that the contract amount is US$1.5 billion, equivalent to approximately 10.62 billion yuan.
This is the latest high profile project involving Chinese entities in Turkey, which has been strengthening its links with Beijing.
Last December the Asian Infrastructure Investment Bank (AIIB) approved two investment projects in Turkey totalling US$500 million, aimed at helping the country advance its urban and energy infrastructure development.
A US$300 million sovereign-backed loan for the Istanbul Seismic Risk Mitigation and Emergency Preparedness Project will improve Istanbul’s disaster resilience against earthquakes and enhance the city’s emergency preparedness. As AIIB’s first urban project in Turkey, the investment will finance structural retrofitting and reconstruction of priority public buildings such as schools, hospitals and other social facilities.
A US$200 million lending facility was also approved, to advance the country’s renewable energy and energy efficiency infrastructure. AIIB is providing long-term financing through Türkiye Kalkınma ve Yatırım Bankası (the Development and Investment Bank of Turkey or TKYB) to privately owned companies in Turkey for investments in renewable energy and energy efficiency infrastructure.
These investments will cover power generation based on wind, solar, geothermal and biomass, along with energy efficiency projects that will result in energy savings and a reduction in carbon dioxide emissions.
Energy demand in Turkey is expected to increase by 50% over the next decade. The country aims to increase renewable energy’s share of total power generation to 50% by 2023 and reduce primary energy consumption by 14% in the same year.
To date, AIIB has invested in five projects in Turkey with a total amount of US$1.4 billion covering infrastructure development in the energy, finance and urban sectors.