VZCZCXRO8789
RR RUEHAG RUEHAST RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN
RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSK RUEHSR RUEHVK RUEHYG
DE RUEHAK #0004/01 0021618
ZNR UUUUU ZZH
R 021618Z JAN 09
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 8365
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHIT/AMCONSUL ISTANBUL 5176
RUEHDA/AMCONSUL ADANA 3484
RHEBAAA/DEPT OF ENERGY WASHINGTON DC
RHEHAAA/NSC WASHDC
RUEAIIA/CIA WASHDC
RUCPDOC/USDOC WASHDC

UNCLAS SECTION 01 OF 03 ANKARA 000004 
 
SIPDIS 
 
E.O. 12958:N/A 
TAGS: ECON ENRG ETRD TU
SUBJECT: Turkey's Nuclear Energy Plans 
 
REF: STATE 127423; 07 ANKARA 2755; 08 ANKARA 570; ANKARA 1028; 
ANKARA 1119; ANKARA 1687; ANKARA 1724 
 
ANKARA 00000004  001.2 OF 003 
 
 
¶1.  (U) This cable responds to Ref A request for information for the 
Civil Nuclear Working Group of the Trade Promotion Coordinating 
Committee. 
 
Overview of Civil Nuclear Power Program 
--------------------------------------- 
 
¶2.  (U) The GOT conducted a tender in 2008 for construction and 
operation of a nuclear power plant in Akkuyu, Mersin Province, with 
a capacity of 4000 MW (+/- 25 %).  The GOT is in the planning stages 
for a second tender for a plant in the province of Sinop on the 
Black Sea coast, however no official documents have been released 
for the tender.  The capacity of the Sinop project would be similar 
to that of Akkuyu.  Turkey has estimated reserves of 380,000 tons of 
Thorium ore at 0.2% concentration and an estimated 9129 tons of 
Uranium scattered around the country.  At present, there is no 
mining of these resources. 
 
¶3.  (U) The GOT sees nuclear power as a way to meet projected power 
shortages and improve on energy diversification and security. 
Electricity demand has been growing at a rate of 6-8% per annum over 
the last 7 years.  Turkey projects 2020 annual demand will be 
between 400 billion and 500 billion kWh, compared to 2007 
consumption of 160 billion KWh.  Thus far, power has been generated 
with a combination of hydro, coal and imported gas.  Currently, 
almost 50% of power generation comes from natural gas fired power 
plants, and the majority of gas is imported from Russia. 
 
¶4.  (U) The GOT's nuclear law provides a 15 year power purchase 
guarantee and provides power plant sites free of charge.  The 
government will also provide environmental impact assessments and 
permits required.  The projects would receive incentives such as 
customs duty exemption and tax holidays.  At this time, the GOT does 
not plan to be an investor.  However, in the event that the private 
sector does not invest, the GOT has indicated that it is open to 
considering public-private partnerships. 
 
¶5.  (U) The following GOT officials are the key decision makers for 
the nuclear power plant projects: 
 
- Dr. Hilmi Guler, Minister of Energy and Natural Resources 
- Mr. Okay Cakiroglu, President, Turkish Atomic Energy Authority 
(TAEK) 
- Mr. Hasan Koktas, President and Chairman, Energy Market Regulatory 
Authority (EMRA) 
- Dr. Haci Duran Gokkaya, CEO and Chairman, Turkish Electricity 
Trading Company, Inc. (TETAS) 
 
¶6.  (U)  The Turkish Atomic Energy Authority (TAEK) inspects all 
nuclear energy related equipment and facilities and determines 
whether or not such facilities and equipment meet national and 
international standards and agreements to which Turkey is a party. 
It also conducts nuclear research and has oversight over small 
research reactors.  It employs approximately 150 people.  According 
to the law on nuclear power passed in November 2007 (ref B), Turkey 
will establish an independent nuclear regulatory body to oversee 
civilian nuclear capability.  Until such an entity is established, 
TAEK will act as the regulator.  It is unclear to what extent TAEK 
or TAEK personnel will be tapped for the new regulatory body. 
 
¶7.  (U) Turkey does not have a domestic nuclear liability law.  The 
Nuclear Law makes reference to the Paris Convention as governing 
liability issues, to which Turkey is a signatory.  However, not all 
amendments to the Paris Convention have been passed by Turkey, nor 
has supporting implementation legislation been adopted.  Turkey is a 
signatory to the following agreements: 
 
- Treaty on the Non-Proliferation of Nuclear Weapons 
- Agreement Between The Government Of The Republic Of Turkey And The 
IAEA for the Application Of Safeguards in connection with NPT 
- Protocol Additional to the Agreement Between The Government Of The 
Republic Of Turkey And The International Atomic Energy Agency For 
The Application Of Safeguards in connection with The Treaty On The 
Non-Proliferation Of Nuclear Weapons 
- The Convention On The Physical Protection Of Nuclear Material 
- Convention On Assistance In The Case Of A Nuclear Accident Or 
Radiological Emergency 
- Convention On Early Notification Of A Nuclear Accident 
- Convention On Nuclear Safety 
- Comprehensive Nuclear-Test-Ban Treaty 
- Paris Convention On Third Party Liability In The Field Of Nuclear 
Energy 
- Protocol To Amend The Convention On Third Party Liability In The 
 
ANKARA 00000004  002.2 OF 003 
 
 
Field Of Nuclear Energy Of 29 July 1960 
- Protocol To Amend The Convention On Third Party Liability In The 
Field Of Nuclear Energy Of 29 July 1960, As Amended By The 
Additional Protocol Of 28 January 1964 And By The Protocol Of 16 
November 1982 
- Joint Protocol Relating To The Application Of The Vienna 
Convention And The Paris Convention 
- The Agreement For Cooperation Between The United States Of America 
And The Republic Of Turkey Concerning The Peaceful Uses Of Nuclear 
Energy 
- Agreement Between The Government Of Canada And The Government Of 
The Republic Of Turkey For Co-Operation In The Peaceful Uses Of 
Nuclear Energy 
- Agreement Between The Government Of The Federal Republic Of 
Germany And The Government Of The Republic Of Turkey For Cooperation 
In The Peaceful Uses Of Nuclear Energy 
- Agreement Between The Government French Republic And The 
Government Of The Republic Of Turkey For Co-Operation In The 
Peaceful Uses Of Nuclear Energy 
- Agreement Between The Government Of Korea And The Government Of 
The Republic Of Turkey For Co-Operation In The Peaceful Uses Of 
Nuclear Energy 
- Agreement Between The Government Of The Republic Of Turkey And The 
Government Of The Argentine Republic For Co-Operation In The 
Peaceful Uses Of Nuclear Energy 
 
¶8.  (U)  Turkey's manufacturing sector includes companies qualified 
for heavy steel construction, reinforced concrete construction and 
manufacturing of some equipment and machinery such as pumps, valves, 
pipes, and motors.  It is likely that the majority of construction 
would be performed by Turkish companies.  Main equipment and 
machinery including reactors, turbines, boilers, heat exchangers, 
sub-stations, nuclear safety equipment, SCADA and Telemetry systems 
would need to be imported. 
 
¶9.  (U) Turkey has many electrical, electronic, civil, mechanical 
and metallurgical engineers and technicians.  Some are experienced 
on power generation.  It is also possible to find engineers and 
technicians for high precision manufacturing and construction. 
However, training for nuclear power generation, nuclear safety, and 
quality assurance is very much required.  A foreign workforce would 
be necessary for the supervision of local staff and for quality 
assurance. 
 
Opportunities for U.S. Industry 
------------------------------- 
 
¶10.  (U) The sole bid for Turkey's first nuclear power generation 
facility is in the evaluation process.  The bidding consortium was 
led by JSC Atomstroyexport (Russia) with JSC Inter RAO UES (Russia) 
and Park Teknik (Turkey).  Five other consortiums were interested - 
including GE Hitachi Nuclear Energy (GEH) as part of an Iberdrola - 
Sabanci consortium - but did not submit bids when the GOT declined 
to grant a time extension or make changes in conditions.  TAEK has 
approved the Russian consortium's technical qualifications and 
announced that the consortium met the TAEK criteria required for 
Nuclear Power Plant establishment.  On January 19, 2009 the Turkish 
Electricity Trading Company (TETAS) will open the envelope providing 
the consortium's offered price per kWh electricity to be delivered 
to TETAS once the power plant is built.  If the price is within 
acceptable limits, the Council of Ministers will make the final 
decision on award the license to the subject consortium.  Otherwise, 
the GOT may cancel this tender to be reopened in 2009, although at 
this point this seems unlikely.  The GOT also plans to announce 
another tender for the private sector to build nuclear power plant 
in the province of Sinop at the Black Sea coast.  The capacity of 
the Sinop project would be similar to that of Akkuyu.  It is 
unlikely that many companies will bid on the second tender if 
conditions remain similar to those of the first. 
 
¶11.  (U) Opportunities may include consulting services; plant 
construction management; reactor sales; turbine and generator sales; 
boiler sales; fuel supply; fuel cycle service; plant operations; 
nuclear safety equipment and waste management. 
 
¶12.  (U) The following companies/consortiums are showing interest in 
nuclear projects in Turkey: 
 
¶1. AECL Atomic Energy of Canada Ltd. (Canada) 
¶2. Itochu Corporation (Japan) 
¶3. Vinci Construction Grand Projects (France) 
¶4. Suez Tractabel (France-Belgium) 
¶5. Atomstroy Export (Russia) 
¶6. Enka (Turkey) - KEPCO (South Korea) 
¶7. China Nuclear Power Components Co. (China) 
¶8. Unit Investment N.V. (Netherlands) 
 
ANKARA 00000004  003.2 OF 003 
 
 
¶9. Haci Omer Sabanci Holding (Turkey) - Iberdrola (Spain) 
¶10. General Electric/Hitachi (GEH)(USA) 
¶11. Alsim-Alarko (Turkey) 
¶12. Hattat Holding (Turkey) 
¶13. RWE (Germany) 
¶14. Ak Enerji (Turkey) 
 
 
Foreign Competitors 
------------------- 
 
¶13.  (U)  Nuclear Supply Countries engaged in Turkey: USA, Canada, 
France, South Korea, Russia, Germany, and Japan.  Of these 
countries, Turkey has bilateral agreements for the peaceful usage of 
nuclear energy with USA, France, Germany, Canada, and Korea. 
 
¶14.  (U) Turkey's bid for EU membership may put pressure on the GOT 
to favor European bidders in future tenders.  Russia's dominant 
position as a supplier of gas to Turkey may also be a consideration.