The FINANCIAL — The European Bank for Reconstruction and Development (EBRD) is supporting the largest resource-efficiency programme in the Turkish industrial sector to date with a US$ 150 million loan to oil refiner Türkiye Petrol Rafinerileri A.Ş. (Tüpraş).
Majority-owned by Koç Holding, Tüpraş is Turkey’s biggest industrial company. It operates refineries in İzmit, İzmir, Kırıkkale and Batman.
The EBRD’s eight-year unsecured loan, with a three-year grace period, will finance a comprehensive US$ 232 million modernisation programme at the company’s refineries in İzmir and Kırıkkale in 2016-2018.
The upgrades include a new on-site thermal power plant, a waste heat recovery system, stack gas treatment, a fluid catalytic cracking unit and hydrocracker unit refurbishments. These improvements will lower the energy intensity of the two refineries, as well as reduce CO2 emissions by 270,000 tonnes per year (625,000 barrels of oil equivalent per year) and reduce water consumption by 120 million cubic metres, according to EBRD.
Investments that bring environmental benefits are at the heart of the EBRD’s mandate. In line with its Green Economy Transition approach, the Bank is committed to increasing the volume of its sustainable financing and broadening its scope.
Riccardo Puliti, Managing Director for Energy and Natural Resources at the EBRD, said: “We applaud Tüpraş for its commitment to adopting high environmental standards and we are pleased to finance this ambitious modernisation programme. We believe that the competitive advantage Tüpraş will gain with lower energy costs will encourage other large industrial players in Turkey to follow suit towards more sustainable practices.”
As energy demand in Turkey is expected to nearly double by 2023, the country’s Energy Efficiency Strategy Paper has set a 20 per cent target for reducing energy intensity by 2023. It is encouraging private actors such as Tüpraş to take bold measures to increasing energy efficiency
İbrahim Yelmenoğlu, Tüpraş General Manager, said: “The EBRD loan is specifically tailored to assist Tüpraş in reducing the energy and water intensities at İzmir and Kırıkkale refineries. The value of these efficiency gains will further improve Tüpraş’ sustainable competitiveness. The EBRD’s decision to grant this loan to our company once again proves trust in the financial credibility and strength of Tüpraş.”
The EBRD started investing in Turkey in 2009 and currently operates from offices in Istanbul, Ankara and Gaziantep. Some 98 per cent of the Bank’s investments in the country are in the private sector and about half of them are in projects that promote the sustainable use of energy.
To date, the EBRD has invested over €7 billion through more than 180 projects in infrastructure, energy, agribusiness, industry and finance. It has also mobilised about €17 billion for these ventures from other sources of financing.
The EBRD’s strategic priorities for the period 2016-18 for its countries of operations, including Turkey, are re-energising growth, strengthening regional integration and addressing global challenges.