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shipments from one of its preferred suppliers, Iran, have been ruled out due to US sanctions. STAR Refinery on the Aliaga peninsula on the Aegean coast has agreed to buy an initial 1 million tonnes of Urals crude—around a tenth of the plant’s annual processing need—from Russia’s Rosneft, Mesut Ilter, the facility’s chief executive officer, told Bloomberg in an interview published on July 21. “If there were no restrictions, we would buy Iranian crude,” he was cited as saying, adding that the refinery can purchase oil from anywhere “as long as our model supports it,” although in practice Azerbaijan’s own light crude isn’t really suitable. Tracking oil shipments from Iran toward Turkey has become trickier since the crude sanctions were ramped up at the start of May, making it difficult to assess how much, if any, Iranian oil Turkey is buying. Socar started operating the 200,000 barrel-a-day STAR Refinery last October. Before then, Tupras was Turkey’s sole refiner. Star now accounts for a quarter of the nation’s refining capacity. At full capacity, the plant is to annually produce 5mn tonnes of diesel, 2.5mn tonnes of petrochemical feedstock and 1.5mn tonnes of jet fuel. Along with Tupras, the Star refinery will be able to meet all Turkey’s domestic jet-fuel demand.
9.2.2 Automotive corporate news
● Ford Otosan
● Others
Volkswagen has finally made a decision on the location for a new auto production plant it is to build outside Germany and it has picked Turkey, German state media outlet ARD reported. The factory will be established in the western Turkish province of Manisa, it added, citing German government officials. Earlier reports suggested Turkey and Bulgaria were the potential candidates for the VW investment with the German giant dropping Turkey because the Erdogan administration did not accept conditions Volkswagen put forward. The latest report suggests that the Turkish government accepted all VW’s demands but did not say what those were. According to ARD, VW finally decided to build the factory in Turkey because of the size of the local auto market, even though labour costs are much lower in Bulgaria. VW calculates that it could sell as many as 40,000 Passat model units annually in Turkey. The carmaker also took into account the fact that the Passat limousine version is highly popular among Turkish officials and the government might buy this model in considerable quantities for official use, ARD said. The Manisa plant will also produce Skoda and Seat models of VW group subsidiaries. If VW officially announces the Turkey investment, the Ankara government will boast that the decision represents foreign investors’ maintaining confidence in the Turkish economy, despite its present travails. The agreement for VW’s Turkish plant will be inked in September or October this year, ARD said.
66 TURKEY Country Report August 2019 www.intellinews.com