Latest
Recommended
Published: Sat, July 22, 2017
Economy | By Melissa Porter

Crimean scandal prompts Siemens to retreat from Russian energy

Crimean scandal prompts Siemens to retreat from Russian energy

The firm announced it will sell its minority stake in the Russian company Interautomatika after it was informed by credible evidence that the company locally modified and illegally moved four gas turbines to Crimea.

Siemens said the diversion of the turbines constituted a "blatant breach of delivery contracts, trust and European Union regulations".

That followed a report in the Sueddeutsche Zeitung newspaper that said Russian President Vladimir Putin gave the assurance personally to Germany's foreign minister, Sigmar Gabriel, in September.

After confirming that two of the turbines had been delivered to Crimea nearly two weeks ago, Siemens announced that it had launched legal proceedings against the individuals responsible.

Munich-based multinational Siemens has been active for 170 years in Russian Federation, where its primary activities are supplying energy equipment and rail technology.

The Reuters news agency reported on Friday that the Kremlin had declined to comment, saying it was a matter for Siemens and its Russian partners.

Siemens shares declined 0.2 percent to 117.90 euros at 10:15 a.m.in Frankfurt, valuing the company at 100.2 billion euros ($116 billion).

Siemens added that new gas power projects in Russian Federation would only be carried out through companies it controls, ensuring "Siemens-controlled delivery and installation" overseen by its own personnel.

"Siemens is implementing an additional controls regime that is exceeding legal requirements by far", it said.

Technopromexport, which is now building the new Crimean power plants, did not immediately respond to a request for comment on Friday.

Like this: