Inter Eyes $2.5Bln Turkey Deal

Electricity trader Inter RAO wants to take part in a $2.5 billion project to build power stations in Turkey, the head of its would-be partner in the project, energy technology firm Tekhnopromexport, announced Tuesday.

Sergei Molozhavy, head of state-owned Tekhnopromexport, said his firm had been approached by Inter RAO with an offer to help construct the power stations.

A source familiar with the project said Tuesday that the tender, to be held this summer, would include licenses for the use of coal deposits.

"This is a very expensive project, costing about $2.5 billion," the source said.

Turkey has announced a tender to build two coal-fired turbine units with a generating capacity of 1,200 megawatts of electricity at a combined cost of $5 billion at one of the two main power stations in the country, Alfsin-Elbistan.

The station now has a capacity of 2,800 megawatts.

Turkey has said that 22 companies have already expressed an interest in the power stations project, including Czech energy firm CEZ, German utility RWE and Japanese energy major Mitsui.

The last day to enter bids for the tender is June 26.

Turkey had tried to hold the tender last year, but failed to attract bids.

Inter RAO, which has power plants mainly in former Soviet countries but also in Finland and Turkey, is 60 percent owned by former state-owned electricity monopoly Unified Energy System.

The rest is held by state nuclear firm Rosatom, which is due to get a majority stake by next spring, after UES this year spins off assets as part of sweeping sector reforms.

The total generating capacity of Inter RAO is about 8,000 megawatts.

Inter RAO plans to hold an initial public offering in 2009 on both foreign and local exchanges, and has expressed ambitions to acquire electricity grid and generation assets throughout Europe.