Turkish conglomerate Kalyon Holding is in the advanced stages of talks with Abu Dhabi’s International Holding Company (IHC) on setting up a strategic partnership for energy assets, according to people familiar with the matter.
A total of four sources said Kalyon, which has big solar and wind concessions in Turkey, was in energy partnership talks with Abu Dhabi, with two of them naming IHC and two saying the talks were advanced, but that a final deal was not yet certain.
Turkey obtains the vast majority of its energy from imports and in order to boost its renewable energy production, it began large-scale solar and wind power station tenders in 2017.
Last November, Turkey and the United Arab Emirates (UAE) signed investment deals worth billions of dollars, including in energy, after talks between President Recep Tayyip Erdoğan and Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed Al Nahyan (MBZ).
Sheikh Mohammed’s visit to Ankara, the first in years, came amid efforts by the two regional rivals to mend strained ties and ramp up economic cooperation.
At the time, a Turkish official told Reuters that one of the deals was between Abu Dhabi Development Holding (ADQ) and Kalyon on energy and infrastructure.
Two sources said the partnership talks with IHC encompassed all of Kalyon’s energy assets. One source said the talks started at the end of last year, adding, "they are holding advanced talks with Abu Dhabi for a partnership in energy assets."
Kalyon Holding told Reuters it was in the process of evaluating international energy cooperation opportunities.
"We are currently in talks with international organizations, including institutions from the United Arab Emirates," it said, adding that the talks offered a "very important opportunity to increase our mutual investments."
IHC and ADQ are both chaired by Sheikh Tahnoun bin Zayed Al Nahyan, the UAE’s national security adviser and a brother of its president, Sheikh Mohammed bin Zayed.
An IHC spokesperson said the company will continue to explore growing its international investment portfolio across different sectors and markets, including Turkey.
"We are currently studying the opportunities in various areas in the Turkish market, including health care, industrial, and food, and we will update the market as per the rules and regulations in case of any formal negotiation for potential investment," the spokesperson said.
Kalyon has a solar panel production plant with a yearly 1,000-megawatt (MW) production capacity in Ankara and building a 1,350 MW solar power plant in the central province of Konya.
Last November, it secured a 12-year financing deal worth $812 million for the Karapınar solar power plant in Konya that will deliver clean electricity to approximately 2 million Turkish households when completed in late 2022.
The total investment to be made in the massive project is estimated to be around $1 billion. It will be the biggest solar power plant in Europe built on a single site and one of the five biggest in the world.