US embassy cable - 03ANKARA5647

UNCLAS ANKARA 005647 
 
SIPDIS 
 
 
SENSITIVE 
 
 
STATE FOR E, EB/CBED, EUR/SE 
NSC FOR QUANRUD AND BRYZA 
 
 
E.O. 12958: N/A 
TAGS: ENRG, PGOV, PREL, TU, IZ 
SUBJECT: FIRST TURKISH POWER TO IRAQ ON SCHEDULE FOR 
SEPTEMBER 15 - ACTION REQUEST PARA 6 
 
1.  With the strong support of the GOT, Turkish power company 
Karadeniz Energy is preparing to export 50 megawatts of power 
from Turkey into the Iraqi power grid.  The 2-year deal was 
signed with the Coalition Provisional Authority in Baghdad on 
August 26, with power scheduled to begin flowing September 
15.  Payments will be a combinmation of cash and bartered 
petroleum. 
 
 
2.  Karadeniz Energy operates a mobile power plant with 
generating capacity of 75 megawatts in Silopi, Turkey, very 
near the Iraqi border town of Zakhu.  Initially, the contract 
calls for Karadeniz to deliver 50 megawatts.  However, 
Karadeniz General manager Dogan Karadeniz told us that the 
contract allows for larger shipments.  He hopes to increase 
deliveries to about 120 megawatts in 3-4 months, and 
eventually to 200 megawatts - the maximum capacity of the 
connecting power line. 
 
 
3.  Karadeniz was confident that the company would meet the 
September 15 target date but admitted that it could slip a 
day or two.  He explained that the connecting line between 
Turkey and Iraq is in place, and Turkish and Iraqi 
technicians were already in Silopi to work out any remaining 
technical difficulties.  He noted that the Turkish Energy 
Ministry had been very supportive and had sent some officials 
to Silopi as well. 
 
 
4.  Karadeniz already received the needed production 
licenses.  The remaining obstacle is an export license. 
Karadeniz explained that there was no problem.  He could not 
initiate the application until the contract was signed on 
August 26.  Nevertheless he expected the license to be 
approved by September 12.  MFA DEputy GD for Energy Hakki 
Akil told us September 4-5 that he expected the Energy Market 
Regulatory Authority to approve the export license in a few 
days. 
 
 
5.  Comment:  From the Turkish side, it appears that 
everything is in place to begin power deliveries -- just 
weeks after signing the contract.  The deal adds to a slowly 
growing list of Turkish initiatives to aid the CPA 
reconstruction efforts in Iraq.  It also demonstrates another 
tangible benefit for Turkey and Turksih businesses. End 
Comment. 
 
 
6.  Action Request:  Akil suggested Turkish companies might 
be able to provide additional electricity to Iraq if they 
used their grid interconnector with Syria.  While stressing 
this was not a formal proposal, he asked how th USG would 
view such an approach.  Embassy would appreciate Washington 
guidance.  End Action Request. 
EDELMAN