First geothermal project in Turkey funded under World-Bank funded risk-sharing mechanisms
The first project to receive support under the World Bank set up Risk Sharing Mechanism scheme for geothermal in Turkey is 3S Kale Nigde Enerji for a planned plant of 25 MW plant. Expected drilling start in April 2021.
The risk-sharing mechanism (RSM) for geothermal projects, set up and funded by the Clean Technology Fund (CTF) through the World Bank, has been implemented with the first project funded through the Turkish Investment and Development Bank (TKYB) solely.
While the first fund will be provided to 3S Kale Holding within the scope of the mechanism, 60 percent of the well cost will be covered from the fund if the company does not achieve success from the geothermal wells to be opened in Nigde.
Turkey Investment and Development Bank, acts as an implementing agency in Turkey of financing development projects taking place in the project RPM through the World Bank/ CTF funding. The fund, with a total size of USD 38 million, will be used for geothermal investments that will be included in the program.
In the event that no results are obtained from the geothermal wells that will be opened by the investors for exploration purposes, 40 percent to 60 percent of the well costs will be covered from the fund. When the works in the wells included in the program are completed successfully, the success premium calculated as 10 percent of the cost will be returned to the fund. Thus, the mechanism will operate as an insurance system and ensure that risks are covered at a certain rate.
The first company to use the risk sharing fund from the mechanism will be 3S Kale Nigde Enerji Üretim AS within 3S Kale Holding. The company, which is entitled to benefit from the mechanism with its Kitreli and Çömlekci geothermal operating licenses in Nigde, will be able to use the fund for two geothermal wells.
Company under an agreement signed between Turkey and the Investment and Development Bank, 60 percent of the cost of the designated wells can not be obtained success in the wells will be met from the fund will be opened.
The first drilling is planned to begin in April 2021, after the completion of the field preparation works in these wells.
Turkey Investment and Development Bank General Director Ibrahim Öztop risk-sharing mechanism stating that the Turkish geothermal energy sector in the implementation for the first time, “the last 10 years remarkable in the development of geothermal investments in sustainable our country showing an increase, a decrease in energy imports and is instrumental in the investment of the orientation to domestic sources.” said.
Stating that more than half of the bank portfolio consists of renewable energy and energy investments, Öztop said, “We will continue to support this area. We believe that the investments that started with 3S Kale Nigde Enerji Üretim AS within the scope of this project we carry out with the World Bank will gain great momentum in the coming period. used the expressions.
The well with the highest temperature is in Nigde
3S Kale Holding General Manager Alp Gürün stated that they have a total of 10 geothermal licenses in Nigde, Ayd?n and Manisa regions.
Stating that they have commissioned a geothermal plant with an installed power of 25 MW in Ayd?n, Gürün said, “We have a target of reaching at least 100 megawatts of geothermal power plant capacity in the next 5 years.” said.
Gurun, Turkey’s rich geothermal resources that have to attract attention, depending on the geological structure was said:
“These resources will provide a significant contribution to national wealth qualifications to reduce Turkey’s energy imports. Our investment in Nigde, Turkey’s one of the youngest volcanic mountain, which is located at the foot of Mount Hasan. The base temperature of the well, which we conducted exploration activities and reached a depth of 3,816 meters, was measured as 295 degrees Celsius. It is the well with the highest temperature discovered in our country in this area. We hope that our efforts, which will gain strength with the funding support of the World Bank, will result in a positive result, and we will bring clean energy production with high environmental sensitivity to our country within the borders of Nigde after Ayd?n. ”
Source: Temiz Enerji
Note: The article was adapted to reflect the sole role of TKYB in implementing the mechanism and that the actual funding was provided by the Clean Technology Fund through the World Bank.