VZCZCXRO7669
RR RUEHAG RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN RUEHLZ
RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHAK #2143/01 1091128
ZNR UUUUU ZZH
R 191128Z APR 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 4949
INFO RUCPDOC/USDOC WASHDC
RHEBAAA/DEPT OF ENERGY WASHINGTON DC
RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 01 OF 02 ANKARA 002143 
 
SIPDIS 
 
USDOE FOR CHARLES WASHINGTON 
USDOC FOR 4212/ITA/MAC/CPD/CRUSNAK 
STATE ALSO FOR EB/CBA FRANK MERMOUD 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ENRG EINV BEXP TU
SUBJECT:  TURKEY - PRIVATE SECTOR NUCLEAR ENERGY SUMMIT 
 
REF: A) ANKARA 7390 
 
B) ANKARA 1581 
 
Sensitive But Unclassified.  Please handle accordingly. 
 
¶1.  (SBU) SUMMARY: In an April 13 meeting with Turkish 
energy companies, Energy Minister Hilmi Guler proposed a 
public-private partnership (PPP) model to be used in 
building Turkey's first nuclear power plant, with a pilot 
plant to be built in the Black Sea province of Sinop. 
Both Guler and State Minister Ali Babacan ruled out 
official Treasury financial gurantees for the project, 
but said the GOT woud provide partial electricity 
purchase guarantees to investors.  U.S. companies will be 
excluded from this project unless the Department moves 
the U.S.-Turkey Peaceful Uses of Nuclear Energy agreement 
to the Hill for ratification (Ref A).  End summary. 
 
¶2. (SBU) Representatives of Koc, Sabanci, Zorlu, Enka, 
Calik, Gama, Akkok, Ak Energy, Alarko, Tekfen, Dogus, 
Guris, Nurol and Habas (a "who's who" list of major 
energy players in Turkey) met April 13 with Energy 
Minister Guler on launching Turkey's nuclear power 
program.  In a press statement after the meeting, Guler 
stressed that the GOT viewed this as part of a critical 
effort to develop nuclear technology in Turkey, not 
simply construction of a nuclear plant.  The Minister 
said the GOT envisioned a 5,000 MW investment package for 
multiple nuclear power plants over time, with this number 
potentially increasing to 7,000-8,000 MW.  Guler also 
disclosed the GOT's intent to build the first nuclear 
plant as a smaller pilot facility (400-500 MW) near the 
Black Sea coastal city of Sinop.  According to site 
evaluations by the Turkish Atomic Energy Agency (TAEK), 
Sinop met most of the 43 criteria for locating a nuclear 
power plant. 
 
¶3. (SBU) Guler said the GOT aimed to use the "Irish 
investment model" of a public-private partnership (PPP), 
which was reportedly well-received by the companies. 
Both Guler and State Minister Ali Babacan, who also 
participated in the meeting, ruled out Treasury 
guarantees for potential investors, but said the GOT 
would provide partial electricity purchase guarantees. 
 
¶4. (SBU) Guler said the GOT was not planning to hold a 
tender for the nuclear plant project, but would "set the 
rules of the game" through discussions and negotiations 
with companies.  As selection criteria, the minister 
listed the GOT's priorities as early finalization, local 
content, fuel technology and technology transfer.  While 
Guler was reluctant to comment on the specific technology 
targeted for the nuclear plant, other reports indicate 
that the GOT aims to employ natural uranium and 
"pressured water reactor technologies" in generating 
nuclear power in Turkey. 
 
¶5. (SBU) The GOT's decision to construct the nuclear 
power plant in Sinop was criticized by various circles, 
including residents of Sinop, who followed the example of 
residents of the Akkuyu region in southern Turkey, which 
opposed construction of a power plant in their region in 
the late 1990s.  Akkuyu residents criticized the GOT for 
expropriating land without compensation and for failing 
to keep employment promises.  The residents of Sinop are 
planning a protest on April 29, the anniversary of the 
1986 Chernobyl nuclear disaster.  In addition, the 
Turkish Electrical Engineers Chamber criticized the GOT's 
adopting nuclear power at a time the world is allegedly 
reducing the use of this resource in energy generation. 
 
¶6. (SBU) Comment: The GOT seems to be serious in its 
efforts to introduce nuclear power to Turkey's energy 
mix.  Turkey's forecasted energy shortage and growing 
reliance on energy imports -- both increasingly the 
subject of public debate -- drive this decision.  Given 
the large amounts of investment and technical expertise 
that will be required to realize the nuclear dream, 
foreign partners/providers will be critical and their 
reaction is still unclear (although many have been 
talking to the GOT).  U.S. Companies such as GE and Stone 
and Webster appear interested; the interest and status of 
Westinghouse (recently acquired by Toshiba) is less clear 
(ref B).  U.S. companies/technology will not be able to 
participate if the US does not ratify the US-Turkey 
Peaceful Uses of Nuclear Energy Agreement (ref A). 
 
ANKARA 00002143  002 OF 002 
 
 
Details on the nuclear power plant model and the GOT's 
role and commitment still need to be fleshed out.  Given 
current law on energy investments and financial 
pressures, the GOT is seeking to avoid Treasury 
guarantees.  The environmental and not-in-my-back-yard 
public resistance may also be a serious obstacle. 
Nuclear waste management is also likely to become a major 
issue. 
Wilson