Turkish steel firms may be excluded from TANAP

ISTANBUL - Reuters

Turkish steel pipe makers have concerns about being excluded from TANAP, if a steel pipe, which is not made in Turkey, will be put on the tender specifications of the project.

Turkish steel pipe producers have concerns about the possibility of their exclusion from the Trans-Anatolian Pipeline Project (TANAP), which will carry Azeri gas to Europe via Turkey, making some $2.5-3 billion loss.

“A steel pipe type, which is not made in Turkey, may be put on the tender specifications of the project,” some sector representatives said last week during a global meeting in the United States. “This may cause approximately $3 billion of loss to us,” the head of Turkey’s Steel Pipe Manufacturers Association (ÇEBİD), Ahmet Erciyas says.

Turkish steel producers also have problems with finding such high-volume amounts of financing for big projects.

“Turkish Eximbank provides high volume loans only to exporting companies, although such banks in other nations also support producers. Even if we could find some low cost loans, the insurance premium will be high due to the high political risks,” he said.

The construction of the 1,850 km long TANAP is planned to be started in 2015 and to be completed in 2018 in three stages. The pipeline will then be connected to the Trans-Adriatic Pipeline (TAP).

The tender notices for the pre-qualification stage of the onshore pipeline and block valve and pipeline inspection gauge, which are also known as “pigging,” stations construction of the TANAP were announced last August.

“A total of 23 companies applied to bid, nine of them are Turkish,” he said.