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Posted On: 29/10/2011
The groundbreaking ceremony for Star Refinery, which is a joint investment between Azerbaijani state-owned oil company SOCAR, and Turkish company Turcas took place earlier this week. The project is worth around $5 billion and is expected to help reduce Turkey's current account deficit. The ceremony, which took place on Izmir Aliaga’s Petkim Peninsula was attended by the Turkish Prime Minister Recep Tayyip Erdogan, and the President of Azerbaijan, Ilham Aliyev.
The project is expected to be completed by 2015 and is the single largest private investment in the country and will have a total oil refining capacity of 10 million tons a year. It is particularly significant as it will be able to produce liquid petroleum gas as well as other petrochemicals which currently have to be imported. At the moment Turkey is dependent on importing foreign oil and gas, and this is one of the largest contributors to the current account deficit. Turkey imported around $75 billion worth of intermediate goods last year, of which $8 billion was petrochemicals.
In addition the project will provide around 10,000 jobs for construction workers, and around 1,000 permanent jobs following its completion in 2015. Part of the project will include building a high school which will give vocational training for Turkish and Azeri students, equipping them for jobs at the refinery.
This project is expected to contribute towards Turkey's 2023 economic development version as the country still expects to become one of the world's 10 largest economies, provided it can bring its current-account deficit under control. Azerbaijan is currently celebrating its 20th year of independence, and this year should see the completion of the Iron Silk Road project, a natural gas pipeline which also marked a major collaboration between the two countries.
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