Turkey's Competition Board Fines Refiner Tupras $184 Million

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Researched by Industrial Info Resources (Sugar Land, Texas)--Turkey's Competition Board has fined oil refiner Tupras (BIST:TUPRS) (Istanbul, Turkey) $184 million (412 million Turkish Liras) in administrative fines for allegedly using its dominant position to harm the oil sector.

According to a filing with Borsa Istanbul, Tupras said that it will pay $138 million immediately and appeal the decision. In July, the tax authorities raided the headquarters of Tupras over allegations of tax fraud.

On January 17, credit ratings agency Fitch Ratings affirmed Tupras' long-term local and foreign currency issuer default rating to be BBB-. With its total refining capacity of 28.1 million metric tons at four refineries at the end of 2011, the company is one of the largest independent refining companies in Europe.

Separately, Tupras will temporarily halt operations at the Izmit refinery for two weeks, beginning February 15, in light of the ongoing Residuum Upgrade Project (RUP) investment. The 11-metric-tonne-per-year Izmit refinery accounts for 39% of Tupras' processing capacity. The temporary halt to operations might slightly dent first-quarter production figures, which might be compensated by higher production later in the year. Meanwhile, Tupras is expected to complete the RUP investment in the fourth quarter of this year. The project will add 2.5 million tons of diesel capacity in 2015.

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