• 4/9/2018

Interview with the Director General of Siemens Gas Turbine Technologies Mr. Nico Petzold

We bring to your attention an interview with Mr. Niko Petzold, Director General of Siemens Gas Turbine Technologies taken by “Impulse”, the magazine of Russian-German foreign trade.

- The opening of large gas turbine production plant in Leningrad Region in 2015 in the Greenstate Industrial Park by YIT was a noteworthy event, as well as proof that the established relations between the Western and domestic companies continue to exist and develop in an economically difficult time. What prompted the reputable Siemens to make such an important decision?

- The STGT joint venture was organized on the basis of its predecessor, a joint venture by partners in Interturbo LLC, which carried out the assembly of gas turbines from 1991 to 2011. Over 10 years, 19 turbines were assembled, of which 5 were delivered to the Russian market.

In 2001, a license to assemble turbines was granted to us together with a Russian manufacturer, OJSC Power Machines. As part of this cooperation, 35 SGT5-2000E turbines were produced, 31 of them for Russia. Currently, turbines assembled by Interturbo are operated at power facilities in Moscow, St. Petersburg, Chelyabinsk, Veliky Novgorod, Urengoy.

In 2011, Siemens AG and OJSC Power Machines created a joint venture STGT. At the same time, two new licensing agreements were signed to produce and service modern Siemens gas turbines with a capacity of 170 MW and 300 MW in Russia. The company was transformed into Siemens Gas Turbine Technology and continued to manufacture gas turbines based on its own production facilities since 2015.

The main objective of STGT is to establish local production of gas turbines with a capacity of more than 60 MW in Russia. To achieve that goal, it was decided to build a modern production complex of international level and outfit it with modern equipment.

- Siemens is named one of strategic partners of the Leningrad Region. What support do you receive from the government of the Leningrad Region? How comfortable do you feel in this region?

- In December 2012, Siemens Gas Turbine Technology LLC entered an investment agreement with the Government of the Leningrad Region. In pursuance of terms of the agreement, Siemens Gas Turbine Technologies LLC, as an investor, is entitled to take advantage of tax benefits provided for by regional legislation.

Our company sees the interest of the Leningrad Region in developing gas turbine production in Russia. In particular, joint work is underway to improve the infrastructure of the complex. The leadership of the Leningrad Region assisted us in implementing the project to install a traffic light when leaving the Greenstate business park on Volkhonskoye Shosse, which will increase the safety of our employees.

- The media has reported earlier that STGT is ready to increase the level of localization to 70% at the plant in the region by 2020, and transit gradually to using parts of domestic production. How successful is that work? Should we expect the opening of new production of your suppliers in the vicinity of your company in the foreseeable future?

- As of today, nine gas turbine units of the SGT5-2000E series with a capacity of 187 MW have been produced and shipped to customers at Siemens Gas Turbine Technology LLC. This is the main product we are putting out. A lot of work has been done to localize the SGT5-2000E, including the development of production of its various components and upgrading the qualifications of local suppliers. Our goal is to increase localization level of the SGT5-2000E gas turbine to 70% by 2020.

In February 2017, the St. Petersburg Chamber of Commerce and Industry issued an act confirming the achievement of localization of SGT5-2000E in STGT LLC at the level of 52% of the contract value of the finished product. On December 29, 2017, the Ministry of Industry and Trade of the Russian Federation issued an official confirmation of the status of industrial product manufactured in the territory of the Russian Federation by Siemens Gas Turbine Technologies LLC for the SGT5-2000E gas turbine.

In order further to increase the level of localization, work continues on qualifications of Russian suppliers of blanks for the components of gas turbine unit, during which the supplier's prospects are assessed, both from commercial and technical points of view. The result of successful qualification consists in adding such supplier to the international supplier base of Siemens AG and authorizing it to its product serially.

The steam generating unit (SGU) life cycle localization program implemented by Siemens Gas Turbine Technologies envisages a further expansion of the range of services provided to Russian power generating companies, as well as a planned increase in the degree of localization of production, as per the requirements of RF Government Resolution N719 of July 17, 2015. At the same time, localization of production and qualifications of suppliers inevitably requires additional investment, which can only be covered by a sufficient number of orders. The launch of mass production of billets at Russian enterprises is also justified only in case there are orders for gas turbines.

- In December 2017, Siemens AG Vice President Dietrich Möller mentioned that this year the company plans to launch a workshop to produce, repair and restore of turbine blades. When do you plan to launch a new workshop?

- In late May – early June 2018, at the site of Siemens Technology of Gas Turbines LLC, it is planned to start commercial operation of the workshop to repair and restore turbine blades for gas turbines of all SGT5-2000E versions. We will carry out full scope of repair works in accordance with Siemens AG technologies and guarantees – incoming inspection, cleaning of used coating, machining, welding, sputtering, finishing assessment of the quality of repairs. All these main processes will be implemented according to specifications of Siemens AG and qualified by German specialists in order to fully comply with the highest quality requirements and guarantee the necessary life of repaired parts, equivalent to new products.

- You are located in one of the most successful industrial parks in the region. Are you satisfied with your choice? What relations do you have with YIT, the managing company?

- For five years, we have been good partners and neighbors of YIT in Greenstate Industrial Park. The choice of site was not accidental and was due to good transport accessibility and available connections to all the communications necessary for production. Both the newly built plant and the expansion of production capacities that affect the infrastructure – all that requires professional and timely support from the management company. We receive such support from YIT in sufficient scope.

- What plans and goals does your company set for the next 10 years?

- Our plans and goals are inextricably linked with the "vision" of the company, which was formed at the opening of the new production complex. Siemens Gas Turbine Technology LLC is the market leader in Russia and the CIS for power generating companies based on high power gas turbines; it contributes to the development of Siemens equipment business for oil and gas and power generation industries. Being a power generation complex with a complete local value generation chain — from R&D to advanced production, project and service implementation, we provide the best solutions for our customers. To implement our “Vision”, we focused our efforts in the following areas:

  • customer orientation
  • cost reduction
  • the latest technology
  • use of local resources and Siemens global experience
  • quality, efficient business processes, high safety standards
  • being an attractive and reliable employer
  • being the center of R&D in the field of power generation

Focusing on the needs of the market, we do not exclude diversifying production to enter the area of equipment for renewable energy sources.

Siemens is one of the world's largest companies and the appearance of such a resident in the Greenstate Industrial Park is a kind of certificate of compliance of our park with international standards,” says Maxim Sobolev and adds: “YIT provided Siemens with a land plot and all the necessary engineering communications in accordance with the agreed schedule, fulfilling its contractual obligations. A modern industrial park is a territory saturated with engineering infrastructure. YIT ensures that this infrastructure is operational 24 hours a day, 7 days a week.”