May 30, 2018 / 11:55 AM / a month ago

OMV pulls out of electricity generation in Turkey

VIENNA (Reuters) - Austrian gas and oil group OMV (OMVV.VI) has agreed to sell its gas power plant Samsun in Turkey to Turkish investment company Bilgin Enerji, pulling out of electricity generation in the country.

FILE PHOTO: The logo of Austrian oil and gas group OMV is pictured at its headquarters in Vienna, Austria, January 21, 2016. REUTERS/Heinz-Peter Bader/File Photo

The sale is subject to regulatory approval in Turkey and expected to close in the fourth quarter, OMV said on Wednesday, adding that the parties had agreed to not disclose the price.

“The divestment of the Samsun power plant is in line with OMV’s strategy 2025 to further optimize its portfolio,” board member Manfred Leitner, who is responsible for the group’s gas and refinery activities, said in a statement.

“It is the final step in the strategic target to reduce the exposure of the non-integrated power business.”

Austria’s largest energy group has significantly reduced its costs by focusing on cheaper Russian operations in recent years. In March, it laid out a medium-term growth strategy which included expansion in growing markets in the Middle East, Australia and New Zealand.

The Samsun sale follows the divestment of fuel retailer Petrol Ofisi to Vitol Investment Partnership a year ago.

The 870 megawatt (MW) gas-fired power plant in Samsun on the Black Sea came into commercial service in 2013.

OMV said it will remain in Turkey with energy sales and trading.

Bilgin Enerji, founded in 2006, is specialized in renewable energy investments and owns several wind power and hydro power plants in Turkey, according to its website.

Reporting by Kirsti Knolle; editing by David Evans

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