Soma Holding won tenders worth TL 70 billion over seven years

Soma Holding won tenders worth TL 70 billion over seven years

Soma mining company owner, Alp Gürkan, speaks to the media in Soma on Friday. (Photo: Today's Zaman, Usame Arı)

May 18, 2014, Sunday/ 17:00:38/ TODAY'S ZAMAN / ISTANBUL
Soma Holding, the firm operating the Soma coal mine in which at least 301 workers died after an explosion on Tuesday, has won dozens of tenders -- worth a total of TL 60-70 billion -- in the mining sector since 2005.

According to a report by the Taraf daily on Saturday, Soma Holding -- whose CEO Alp Gürkan said during a press conference on Friday that he had not met Prime Minister Recep Tayyip Erdoğan prior to the recent disaster -- was in a debt spiral before 2005.

The company took over the Soma coal mine, which is estimated to contain 18 million tons of coal reserves, from Turkish Coal Enterprises (TKİ) in 2005 in line with the "rödövans" system.

Rödövans refers to the rental of a mine in return for a percentage of its profits. This system was first offered to subcontractors for previously illegal mines in the 1970s to prevent the continuation of unlicensed mining. The word rödövans is a loanword from French (redevance) and means fees or royalties. The use of the rödövans system in Turkey became widespread in the 1990s, and with a new mining law passed by the ruling Justice and Development Party (AK Party) government in 2005, the system became part of the country's mining law.

Soma Holding, whose original name was Soma Kömür A.Ş., started its coal mining operations in 1984. After taking over the Soma coal mine, the company also took over another coal mine in Soma's Geventepe region from the TKİ on Sept. 8, 2005. The annual coal production from that mine is 1 million tons and the company will operate the mine until 2016. Soma Holding made TL 90 million in profit from the mine in 2012.

In 2011-2012, TKİ awarded the Merkez Ocak mine near Geventepe, which has over 6 million tons in reserve, to Soma Holding without even holding a tender. In the same period, Soma Holding also took over the Işıklar Field in Soma, which has 20 million tons of coal reserves.

The company also won a tender opened by the TKİ in Zonguldak in 2011, and received the right to operate the Bağlık-İnağzı coal mine for 36 years. The field has 136 million tons of coal.

In 2013, Soma Holding took over a mining operation in Merzifon, a district of Amasya province, for an agreed period of 35 years. The field produces 1.2 million tons of coal annually. It has also been reported that the company has plans to construct a thermal plant in Merzifon worth TL 500 million.

According to Taraf, the TKİ allegedly buys coal from Soma Holding without opening tenders and pays much more money to the firm than it would receive in an open tender.

In addition to mining, the holding has also been involved in the construction sector since 2010. Soma İnşaat A.Ş. built Turkey's second-tallest building, the 56-floor Spine Tower, in İstanbul's Maslak business district.

Connections between the AK Party and Soma Holding have also come to light recently. It has been reported that Soma Holding Mine Enterprises General Manager Ramazan Doğru's wife, Melike Doğru, was elected as an AK Party member of the Soma Municipal Council in the March 30 local polls.
Keywords: soma , tenders
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