(Updates with quotes, background, details)
ANKARA, Dec 9 (Reuters) - Russia’s Rosatom has stopped construction work at Turkey’s first nuclear power plant, Turkish energy officials said on Wednesday, as relations between Moscow and Ankara continue to worsen after the downing of a Russian jet.
State-owned Rosatom has not terminated the contract for the building of the $20 billion project and is reluctant to do so because of the heavy compensation clauses, energy officials said. However, Turkey is already assessing other potential candidates for the project, the officials told Reuters.
The possible cancellation of the project is unlikely to have any impact on Turkey’s immediate energy supplies, as the planned nuclear power plant was not seen coming online before 2022 and had already run into delays due to regulatory hurdles and Moscow’s financial woes.
Keen to wean itself off an almost complete dependence on imported energy, Turkey in 2013 commissioned Rosatom to build four-1,200 megawatt (MW) reactors.
“Following the downing of the Russian warplane, the project has been thrown into massive uncertainty,” one senior energy official said. “The Russians have already invested $3.5 billion in the project.”
“There are clauses in the Akkuyu contract outlining large sums of compensation in case of unilateral termination. That’s why the Russian are not making a move on that for now,” he said, without specifying the value of compensation.
Rosatom declined to comment on Wednesday while a source at the Akkuyu project company said was unaware of a halt in construction.
Moscow and Ankara have been at loggerheads since Turkey downed a Russian warplane along the Turkey-Syria border two weeks ago saying it violated its air space, the most serious incident between Russia and a NATO member state in half a century.
Moscow responded by economic sanctions, cancellation of visa-free travel and blamed Turkish leadership of being complicit in illegal oil trade with Islamic State.
Akkuyu is the latest casualty of sour relations, as Russia last week said it has suspended preparatory work on the TurkStream pipeline project.
Turkish energy officials said if Russia pulls out, there were other candidates for the project.
“There are prominent countries which are keen on this project,” another energy official said. “Turkey has plans for a third nuclear power plant as well. Obviously this political situation makes it difficult for Russia to be the one building it.”
The Turkish government in 2013 picked a Japanese-French consortium to build a second nuclear power plant, a project expected to cost an estimated $22 billion. (Additional reporting by Svetlana Burmistrova; Writing by Humeyra Pamuk; Editing by Jonny Hogg and William Hardy)
Our Standards: The Thomson Reuters Trust Principles.