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German Company Alleges Russia Violated Sanctions Sending Turbines to Crimea

Putin promised energy security for annexed territory, but he can’t seem to provide it.

BERLIN, GERMANY - MARCH 02:  German President Joachim Gauck (wearing white helmet) listens to a worker during a visit by Gauck to the Siemens gas turbine factory on March 2, 2017 in Berlin, Germany. Gauck will be stepping down as German president later this month.  (Photo by Sean Gallup/Getty Images)
BERLIN, GERMANY - MARCH 02: German President Joachim Gauck (wearing white helmet) listens to a worker during a visit by Gauck to the Siemens gas turbine factory on March 2, 2017 in Berlin, Germany. Gauck will be stepping down as German president later this month. (Photo by Sean Gallup/Getty Images)
BERLIN, GERMANY - MARCH 02: German President Joachim Gauck (wearing white helmet) listens to a worker during a visit by Gauck to the Siemens gas turbine factory on March 2, 2017 in Berlin, Germany. Gauck will be stepping down as German president later this month. (Photo by Sean Gallup/Getty Images)

German manufacturing giant Siemens is suing a Russian state-owned firm after two Siemens gas turbines ended up in Crimea, a region subject to EU sanctions, according to Reuters.

Siemens sold several gas turbines to Russian state-owned Technopromexport, believing that the equipment would be sent to the southern Russian locality of Taman. 

But in June, Technopromexport posted technical documents online that revealed that two of those turbines were to be installed in new power plants in Crimea. After Reuters revealed last week that the turbines had already been shipped there, Siemens announced that it was seeking criminal charges amid tight scrutiny.

German manufacturing giant Siemens is suing a Russian state-owned firm after two Siemens gas turbines ended up in Crimea, a region subject to EU sanctions, according to Reuters.

Siemens sold several gas turbines to Russian state-owned Technopromexport, believing that the equipment would be sent to the southern Russian locality of Taman. 

But in June, Technopromexport posted technical documents online that revealed that two of those turbines were to be installed in new power plants in Crimea. After Reuters revealed last week that the turbines had already been shipped there, Siemens announced that it was seeking criminal charges amid tight scrutiny.

“Siemens has received information from reliable sources that at least two of the four gas turbine sets, which were delivered for the project in Taman, Southern Russia, have been moved to Crimea against our will,” Siemens wrote in a statement.

Russia annexed Crimea from Ukraine in 2014, a move the EU denounced as illegal. Crimea was traditionally dependent on Ukraine’s power grid for its energy supply. But after annexation, the EU levied tough sanctions and Ukraine turned off the switch, leaving Crimea subject to frequent power shortages.

President Vladimir Putin promised Crimean residents that he would provide energy security, but sanctions have made that promise hard to keep. Russia has plans to build two new power plants there, but sanctions prohibit EU companies from supplying the region with the necessary technology.

Russia does not make the type of turbines needed for the planned power plants, and a deal with an Iranian firm fell through.

German Ambassador to Russia Rüdiger von Fritsch warned that the apparent sanctions violation could put a chill on German investment in Russia, calling it a “serious blow to trust” in an interview with Interfax.

Ukraine has long relied on Russia for oil and natural gas, a bargaining chip that Moscow has played repeatedly. In 2006, Russia turned off the natural gas supply to Ukraine after Kiev didn’t meet its demand to pay gas prices at market levels. The cutoff caused a crisis across Europe, which gets much of its natural gas from Russia via Ukraine.

Sean Gallup/Getty Images

Bethany Allen-Ebrahimian is a journalist covering China from Washington. She was previously an assistant editor and contributing reporter at Foreign Policy. Twitter: @BethanyAllenEbr

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