BAKU

Azerbaijan’s state energy firm SOCAR and Turkey’s major petrochemical company Petkim have agreed to defer the last payment for Petkim’s stake in SOCAR Turkey Aegean Refinery (STAR), SOCAR’s refinery in Turkey, sources at SOCAR told the Tribune.

SOCAR’s subsidiary in Turkey, SOCAR Turkey Enerji A.S. (STEAS), and Petkim agreed that payment of the last of three  $240 million instalments for an 18-percent stake in STAR will be deferred to January 3, 2022. It was initially supposed to be made in June this year.

In 2018, Petkim signed an agreement with SOCAR Turkey to buy out the stake in the STAR refinery, Turkey’s third-largest oil refinery.

Petkim said the payment was postponed “due to the pandemic and market conditions.”

“Due to the effect of the COVID-19 pandemic, which continues to affect the whole world, as well as the fact that the completion date of entry under STAR financial contracts has not yet arrived, it was advisable to postpone the date (of the last payment and closing of the financial transaction) until no later than January 3, 2022,” the company said in a statement published on the Turkish Public Disclosure Platform (KAP).

Petkim is 51-percent-owned by STEAS, which in turn is 87-percent-owned by SOCAR and 13 percent by Goldman Sachs International. SOCAR acquired a controlling stake of Petkim in 2008 for $2.2 billion.

The $6.3 billion STAR refinery is also owned by SOCAR. Its current annual capacity is 10 million tonnes of oil. The 18-percent stake in STAR is estimated at $720-740 million and Petkim issued and placed bonds worth $500 million in 2018 to acquire it.

According to official estimates, the market value of the STAR refinery will reach $7 billion by the end of 2022. The refinery was commissioned in the fall of 2018 and its annual capacity is expected to reach 11.5 million tonnes of oil by 2023-24.

Petkim Petrokimya Holding, founded on April 3, 1965, is Turkey’s leading petrochemical complex. The complex produces ethylene, polyethylene, polyvinyl chloride, polypropylene and other petrochemical products that are used in the production of plastics, textiles and other consumer and industrial goods.

Fitch Ratings has affirmed Petkim’s long-term Issuer Default Rating (IDR) at ‘B’ with a “stable” outlook in October 2020.

SOCAR’s total investment in the Turkish fuel and energy complex has reached $ 19.5 billion.