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Thames Water in Turkey : Corruption Case


Thames Water, Britain's biggest water company and part of RWE, in September 2002 was asked to renegotiate a contract to operate an $891m Turkish water plant after irregularities were alleged in the plant's commissioning.

It was also reported that former and present Turkish treasury officials were being investigated for possible misconduct in approving a government guarantee for the project.

The Turkish Court of Accounts, which audits state finances, claimed in April 2002 that the plant cost far more than necessary and double the amount envisaged. It alleged treasury officials responsible for checking the project's financial structure knew before the guarantee was given "that due to the high price there was a possibility the water could not be sold".

The court's report said the Build Operate and Transfer (BOT) model was unsuitable, and that expected industrial consumers failed to materialise as the water was too expensive. It said neighbouring municipalities would not buy water from the plant for the same reason. Izmit municipality, in spite of undertaking to buy 492m cubic metres of water a year, made no provision for paying for the water in its 1999 or 2000 budgets.

The debt-ridden central government in Ankara has had to pay millions of dollars a year to the consortium behind the project.


The following lists all references contained in our database that are relevant to this briefing
Financial Times [9/4/2002] 'Thames Water defends $891m Turkish project' by Leyla Boulton in Ankara [Source ID = 7126]

Bloomberg News [9/4/2002] 'THAMES WATER ASKED TO RENEGOTIATE TURKISH PROJECT, FT REPORTS' [Source ID = 7367]

 [9/5/2002] 'Thames Water defends its role as Turkey probes water project' by LEYLA BOULTON [Source ID = 7368]

Financial Times [9/5/2002] 'Thames Water defends Turkish plant deal' by LEYLA BOULTON [Source ID = 7374]

The Times [9/5/2002] 'Thames Water negotiates' [Source ID = 7375]

AFX European Focus [9/4/2002] 'RWE's Thames Water asked to review 891 mln usd Turkish water plant - report' [Source ID = 7376]

Business Wire [4/15/2002] 'Thames Water's Chief Executive Receives Top Award' by Thames Water Press Office [Source ID = 7377]

Water Power & Dam Construction Water Power & Dam Construction [11/26/2001] 'UPRATING & REFURBISHMENT; RENOVATION WORKS IN THE PIPELINE' [Source ID = 7378]

International Water Power & Dam Construction [11/1/2001] ' Renovation works in the pipeline' [Source ID = 7379]

Global Water Report [9/9/2002] 'Turkish officials under investigation over possible misconduct-' : http://www.platts.com/gwr/090902.shtml [Source ID = 7519]

Water Technology website (accessed: 25/02/2003) [2/25/2003] 'RWE-Thames gains 15-year BOT in Izmit, Turkey' : http://www.water-technology.net/projects/izmit/index.html [Source ID = 7661]

Financial Times [9/5/2002] 'Thames Water defends Turkish plant deal (Izmit, Turkey)' by Leyla Boulton: http://www.water-technology.net/projects/izmit/index.html [Source ID = 7669]

Project Finance (Euromoney Institutional Investor) [7/1/2000] 'Waterworld' by Ahmad, Taimur: http://www.projectfinancemagazine.com [Source ID = 7723]

Mid Devon Gazette [6/20/2000] '30 years service to water industry' : http://www.projectfinancemagazine.com [Source ID = 7724]

Middle East Economic Digest [1/5/1996] 'TURKEY: Financing package signed for Izmit BOT water' : http://www.projectfinancemagazine.com [Source ID = 7725]


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