The World Bank announced $400 million of additional financing for the first gas storage facility in Turkey's underground salt formation Wednesday.

The $400 million will be given to Turkey to be paid back over 16 years. After an eight-year grace period, the loan will finance the running of a gas storage facility at Tuz Golu (Salt Lake) - one of the largest hypersaline lakes in the world, and the second largest lake in Turkey.

Turkey is second in the world after China in terms of its rising energy demand, and consequently the country aims to upscale renewable energy by 30 percent by 2023.

The world bank´s funding aims to help Turkey meet its increasing power demand by implementing critically needed gas storage and network infrastructure facilitating large-scale renewable energy generation.

Turkey´s Tuz Golu (Salt lake) underground gas storage facility is located in an underground salt formation close to the salt lake in South Central Turkey and upon completion, will have a storage capacity of about 960 million cubic meters of working gas and 460 million cubic meters of cushion gas (the portion of gas which is required to remain in the cavern to maintain its integrity). 

The facility will have the capacity to deliver 40 million cubic meters of gas per day for up to 20 days, and can be refilled at the rate of 30 million cubic meters per day over a period of 25 days.

Currently, Turkey generates 43 percent of its energy needs from natural gas, a quarter from both coal and hydro-electricity and 7 percent from renewables.

Domestic reserves of oil and gas can only meet ten percent of Turkey's current annual consumption, and the country relies on costly energy imports to fuel its growing economy. These imports are one of the main causes of the country’s $60 billion trade deficit. Consequently, the country is always striving to find new energy sources. 

Turkey’s state owned TPAO - the company responsible for oil and gas exploration activities, invests heavily in local fields and exploration projects in the Middle East, South America and the Black Sea region. The fields in southeastern Turkey are the main source for oil and gas production.

"Natural gas consumption has grown rapidly in Turkey over the past two decades. Natural gas accounts for almost one-third of the country’s primary energy supply, and fuels almost 50 percent of electricity generation,” said Martin Raiser, World Bank country director for Turkey. 

"As household and industrial demand increases, the construction of natural gas storage facilities in this project will help keep the cost of natural gas more stable across the seasons, give better security of supply, and encourage the construction of gas distribution networks." 

The World Bank also provided financing for the Baku-Tbilisi-Ceyhan pipeline, which carries Azerbaijani oil to Turkey, and has helped with other energy projects related to the the South Caucasus and energy storage in central Turkey. 

Turkey sees $7.5 billion of investment in the oil and gas sector with 58 operating companies in 2014, compared to 2002 with around 20 companies with investment which totaled $42 million.