The Turkish energy minister has fired back at Abu Dhabi National Energy over delaying an investment decision on a US$12 billion coal megaproject.
Turkish energy minister fires back over Taqa power project delay
The Turkish energy minister has fired back at Abu Dhabi National Energy (Taqa) over delaying an investment decision on a US$12 billion coal megaproject over what he called "political reasons."
This week Taqa said it would not make a final investment decision on the coal mining and power plant development, expected this summer, until 2014 because of "spending priorities."
Taner Yildiz, the Turkish energy minister, told local reporters that Ankara had launched discussions with other potential investors to take Taqa's place and would not change its political views in Egypt and Syria.
"There is always a B or C option," he said in the Hurriyet Daily News. "We will stand firm with our decision, whether Taqa will decide to delay investment in the Afin-Elbistan basin or will go ahead with it. We have started to talk with other countries."
In January, when Emirati officials travelled to Ankara to sign the agreement with Mr Yildiz to develop the nation's lignite coal resources, the UAE was targeting raising bilateral trade with Turkey to US$10 billion a year by 2015.
"I think there's a commercial aspect behind it, which is the Turkish economy slowing down and questions over the project itself," said Robin Mills, the head of consulting at Manaar Energy, a regional consultancy.
"Maybe the project doesn't seem as attractive as it did recently.
The ouster of Mohammed Morsi from the Egyptian presidency has opened a rift between the GCC and the government of Recep Tayyip Erdogan, who has criticised the removal of the Muslim Brotherhood leader.
Last month as the Turkish lira slid in the wake of protests against Mr Erdogan, the UAE Central Bank issued a circular to banks asking about their level of exposure to Turkey. Gulf Capital and Abraaj Capital are among other UAE investors there.
Turkish and Gulf interests have also diverged in Syria, where Turkey has been known for supporting rebels on the more radical Islamist end of the spectrum.
"I wish that Taqa's choices weren't based on political reasons," said Mr Yildiz. "It seems like the latest incidents in Egypt and Syria have put Taqa in a position to make choices about its energy investments from its perspective."
A Taqa spokesman declined to comment on whether the delay was motivated by politics and said Taqa was not exiting the project.