Power plant of STEAG's subsidiary ISKEN dedicated by German Chancellor; 1.5 billion US dollar power plant is the largest foreign direct investment in Turkey

A significant day in the history of STEAG AG, a subsidiary of RAG Aktiengesellschaft: On Tuesday (February 24, 2004), German Chancellor Gerhard Schröder and Turkish Prime Minister Recep Tayyip Erdogan jointly dedicated the hard coal-fired power plant Iskenderun. The 1,210 megawatt large power plant in Southeast Turkey had been completed in a record time of just 39 months. With an investment volume of 1.5 billion US dollar, the power plant is not only the largest single investment ever by a German company in Turkey, but also the largest foreign direct investment in this country to date. Iskenderun will supply enough electric power to meet about 8 percent of the Turkish electricity demand.

"Use of the primary energy source coal will continue to be necessary for many years, because it is the energy source with the largest resources world-wide," said Chancellor Schröder in front of thousands of guests who appeared at the power plant site to celebrate the formal opening of the plant. At the same time, the power plant makes a substantial contribution to the protection of the environment, by using most modern environmental technology. The Turkish Prime Minister, too, was full of praise: A secure energy supply is the basis for dynamic economic growth, said Erdogan.

The Chairman of the Management Board of STEAG AG, Dr. Jochen Melchior, referred to the power plant project of the company's subsidiary ISKEN as a "quantum leap in the company's history". Dr. Werner Müller, Chairman of STEAG's Supervisory Board alluded to the project as "a milestone in Turkish-German business relations".

The power plant was planned, financed with the support of an international banking syndicate, and built by Essen-based STEAG AG whose subsidiary ISKEN operates the plant consisting of two units with a net capacity of 605 MW each. Every year, the plant will convert 3.3 million tons of imported hard coal into electricity. The imported coal, partly supplied by RAG International, is transported by large ocean-going vessels into the Bay of Iskenderun, where it is reloaded by an off-shore transshipper onto smaller barges which finally transfer the coal to the plant's jetty. The transshipper is the world's largest floating coal transshipment plant so far.

As many as 4,000 people worked at the large construction site during the past three years, about 250 found permanent, qualified employment in the power plant. More jobs were created around the provincial capital Adana, a metropolis with a population of more than 1.5 million, located about 115 km from the Syrian border.

Owing to its advanced environmental equipment for flue gas cleaning, protection of water quality and noise protection the Iskenderun power plant does not only meet the Turkish environmental standards but also those of the World Bank. In addition, the project company ISKEN operates a continuous environmental monitoring and environmental management program. Making use of ultra-modern technology and advanced process control, the power plant achieves a high efficiency. The by-products arising from power plant operation, such as fly ash and gypsum are marketed for industrial utilization in Turkey and in the international market.

The Iskenderun hard coal-fired power plant in facts and figures Investment: 1.5 billion US dollar Construction period: 39 months Commercial operation: since November 22, 2003 Installed capacity: 1,320 MW gross, 1,210 MW net Tower boiler height: 100 m each Capacity of coal yard: 800,000 tons Coal input: 3.3 million tons per year