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ANKARA (Reuters) - The leaders of Turkey and Russia marked the official start of work to build Turkeys first nuclear power station on Tuesday, launching construction of the $20 billion Akkuyu plant in the southern province of Mersin.

The plant will be built by Russian state nuclear energy agency Rosatom and will be made up of four units each with a capacity of 1,200 megawatts.

Russian President Vladimir Putin and Turkeys Tayyip Erdogan marked the start to construction, watching by video link from Ankara.

When all four units go online, the plant will meet 10 percent of Turkeys energy needs, Erdogan said, adding that despite delays Turkey still planned to start generating power at the first unit in 2023.

Speaking at a later news conference with Putin, Erdogan said the cost of the project may exceed the planned $20 billion for the 4,800 megawatt (MW) plant, part of Erdogans 2023 vision marking 100 years since the founding of modern Turkey and intended to reduce Turkeys dependence on energy imports.

Since Russia was awarded the contract in 2010, the project has been beset by delays.

Last month, sources familiar with the matter said Akkuyu was likely to miss its 2023 target start-up date, but Rosatom, which is looking for local partners to take a 49 percent stake in the project, said it is committed to the timetable.

The Interfax news agency cited the head of Rosatom saying the sale of the 49 percent stake was likely to be postponed from this year until 2019.

Turkish companies have been put off by the size of the financing required as well as by concerns they will not receive a sufficient share of the lucrative construction side of the deal, two industry sources have said.

Erdogan told the news conference Turkey may cooperate with Russia on defense projects besides the S-400 missile defense system which Moscow has agreed to supply to Ankara. He did not give further details.

Turkey signed an agreement to buy the S-400 system in late December in a move which raised concern in the West because it cannot be integrated into NATOs military architecture.

Iranian President Hassan Rouhani will join Erdogan and Putin for a three-way summit on Syria in Ankara on Wednesday.

Additional reporting by Ece Toksabay and Denish Pinchuk in Ankara and Andrey Ostroukh in Moscow; Writing by Dominic Evans and Daren Butler; Editing by Robin Pomeroy

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ISTANBUL (Reuters) - Turkish President Tayyip Erdogan called his Israeli counterpart Benjamin Netanyahu a terrorist on Sunday, escalating an exchange of insults that started after he criticized Israels lethal military response to a demonstration on the Gazan border.

Israel has defended the killing of 15 Palestinians during Fridays demonstration and Netanyahu tweeted that the Israeli army will not be lectured by those who have indiscriminately bombed civilian populations for years, referring to Turkey.

Erdogan told supporters on Sunday: We dont have the shame of invading on us, Netanyahu. You are an invader and right now are present in those lands as an invader. At the same time, you are a terrorist.

In another speech he said: You are a terrorist state. It is known what you have done in Gaza and what you have done in Jerusalem. You have no one that likes you in the world.

In a later tweet, Netanyahu said: Erdogan is not accustomed to being answered back to, but he should start getting used to it. He who occupies northern Cyprus, encroaches on Kurdish territory and massacres civilians in Afrin cannot preach to us on values and morals.

Israels defense minister has rejected calls for an inquiry into Fridays events.

Hamas, the dominant Palestinian group in Gaza, said five of the dead were members of its armed wing. Israel said eight of the 15 belonged to Hamas, designated a terrorist group by Israel and the West, and two others came from other militant factions.

Reporting by Ali Kucukgocmen and Ori Lewis in Jerusalem; Editing by Robin Pomeroy

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ISTANBUL Turkish President Recep Tayyip Erdogan said Sunday that his country had begun operations in Iraq's Sinjar region, an area where it had threatened cross-border military action.

The announcement came two days after sources said Kurdish PKK militants would withdraw from Sinjar. The PKK, or Kurdistan Workers Party, has waged an insurgency against the Turkish state for decades.

"We said we would go into Sinjar. Now operations have begun there. The fight is internal and external," Erdogan told a crowd in the Black Sea province of Trabzon, without elaborating on what operations he was referring to.

Iraq's Joint Operations Command denied that any foreign forces had crossed the border into Iraq.

"The operations command confirmed that the situation in Nineveh, Sinjar and the border areas was under the control of Iraqi security forces and there is no reason for troops to cross the Iraqi border into those areas," it said in a statement.

But Erdogan said last week the PKK was creating a new base in Sinjar about 75 miles west of Mosul and that Turkish forces would attack if necessary.

Sources in northern Iraq said Friday the PKK would withdraw from Sinjar, where it gained a foothold in 2014 after coming to the aid of the Yazidi minority community, who were under attack by Islamic State militants.

In October, Iraqi government forces launched an offensive to retake the area in response to a Sept. 25 referendum on Kurdish independence, which Baghdad opposed.

The PKK is considered a terrorist organization by Turkey, the European Union and the United States. For decades, it has been based in Iraq's Qandil mountain range, near the border with Iran.

Turkish troops and their rebel allies swept into northwest Syria's Afrin town this month, the culmination of an eight-week campaign to drive Syrian Kurdish YPG fighters from the region. Turkey sees the YPG as terrorists and an extension of the outlawed PKK.

Erdogan has vowed to extend the military operation along the Syrian border and on Sunday said the Turkish-led forces would take control of the town of Tel Rifaat.

Many civilians and YPG fighters have gathered in and around Tel Rifaat after Turkey seized control of Afrin. The Kurdish-controlled enclave is cut off from a larger expanse of Kurdish territory in the northeast of Syria.

The United Nations said last week that around 75,000 people had been displaced to Tel Rifaat and surrounding areas from Afrin, and more were expected to come.

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Erdogan says 'operations' start against Kurdish PKK in Iraq

ISTANBUL (Reuters) - President Tayyip Erdogan said on Sunday that Turkey had begun operations in Iraqs Sinjar region, an area where it has threatened a military incursion, two days after sources said Kurdish PKK militants would withdraw from the area.

We said we would go into Sinjar. Now operations have begun there. The fight is internal and external, Erdogan told a crowd in the Black Sea province of Trabzon, without elaborating on what operations he was referring to.

Iraqs Joint Operations Command denied that any foreign forces had crossed the border into Iraq.

The operations command confirmed that the situation in Nineveh, Sinjar and the border areas was under the control of Iraqi security forces and there is no reason for troops to cross the Iraqi border into those areas, it said in a statement.

Sources in Sinjar said there was no unusual military activity in the area on Sunday.

The Kurdistan Workers Party (PKK) has waged an insurgency against the Turkish state for decades. President Tayyip Erdogan said last week they were creating a new base in Sinjar, and that Turkish forces would attack if necessary.

Sources in northern Iraq said on Friday the PKK would withdraw from Sinjar, where it gained a foothold in 2014 after coming to the aid of the Yazidi minority community, who were under attack by Islamic State militants.

The PKK, considered a terrorist organization by Turkey, the European Union and the United States, has for decades been based in Iraqs Qandil mountain range, near the border with Iran.

Turkish troops and their rebel allies swept into northwest Syrias Afrin town this month, the culmination of an eight-week campaign to drive Syrian Kurdish YPG fighters from the region. Turkey sees the YPG as terrorists and an extension of the outlawed PKK.

Erdogan has vowed to extend the military operation along the Syrian border and on Sunday said the Turkish-led forces would take control of the town of Tel Rifaat.

Many civilians and YPG have gathered in and around Tel Rifaat after Turkey seized control of Afrin. It is a Kurdish-controlled enclave, cut off from a larger expanse of Kurdish territory in the northeast of Syria.

The United Nations said last week that around 75,000 people had been displaced to Tel Rifaat and surrounding areas from Afrin, and more were expected to come.

Additional reporting by Lisa Barrington in Beirut and Raya Jalabi in Baghdad.; Writing by Daren Butler; Editing by Matthew Mpoke Bigg and Kevin Liffey

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VARNA, Bulgaria (Reuters) - The European Union holds an uneasy summit with Turkey on Monday, when it is likely to provide Ankara with fresh cash to extend a deal on Syrian refugees but deflect Turkish demands for deeper trade ties and visa-free travel to Europe.

With the bloc critical of what it considers to be Turkish President Tayyip Erdogans growing authoritarianism at home and his intervention in Syrias war, Brussels had hesitated to agree to the summit.

But host Bulgaria viewed the meeting at the Black Sea port of Varna as a rare chance for dialogue with the country that remains a candidate for EU membership despite years of stalled talks.

EU leaders also cited Turkeys importance as a NATO ally on Europes southern flank and in curbing immigration to Europe from the Middle East and Africa.

I am looking with mixed feelings towards the Varna summit because the differences in views between the EU and Turkey are many, said European Commission President Jean-Claude Juncker, who will represent the bloc along with European Council President Donald Tusk.

It will be a frank and open debate, where we will not hide our differences but will seek to improve our cooperation, Juncker told reporters on Friday after a two-day EU summit that discussed Turkey.

At that meeting in Brussels, leaders condemned what they said were Turkeys illegal actions in a standoff over eastern Mediterranean gas reserves with bloc members Greece and Cyprus.

But in a familiar pattern of public recrimination, Turkeys minister for EU affairs, Omer Celik, said Ankara viewed the summit as an important opportunity to move our relations forward and that he expected the same positive and constructive approach from the EU.

Erdogan will seek more money for Syrian refugees, a deeper customs union and progress in talks on letting Turks visit Europe without visas, a Turkish foreign ministry spokesman said.

EU money is likely to be forthcoming, but little else, EU officials and diplomats said.

The bloc is set to grant Turkey a second 3 billion euro ($3.7 billion) tranche to provide for the Syrians it hosts under a March 2016 deal to take in migrants fleeing the countrys war.

However, EU diplomats said that Erdogans invitation to Varna will come at the price of more sharp criticism from EU counterparts who say that Turkey has been backsliding on democracy and human rights since a failed coup in July 2016.

Some 50,000 people, including journalists, have been arrested while a further 150,000, including teachers, judges and soldiers, have been sacked or suspended from their jobs since the attempted coup.

The meeting in Varna is likely to be one of the last opportunities to maintain dialogue, said Bulgarian Prime Minister Boyko Borissov, whose nation holds the EUs rotating presidency.

Despite the need for Turkeys cooperation on security and foreign policy, the EU should maintain a tough line, said Marc Pierini, a former EU ambassador to Turkey, now at the Carnegie Europe think-tank.

Its quite tempting for EU politicians to go for a transactional relationship with Turkey, but Erdogan is not going to stop EU-bashing for his nationalist agenda, he Pierini.

Additional reporting by Robin Emmott; Writing by Alissa de Carbonnel @AdeCar; Editing by David Goodman

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