Page 6 - AsiaElec Week 32

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Russia rejects Siemens’s bid to localise turbine production
GLOBAL
RUSSIA’S Industry and Trade Ministry has rejected an application by Germany’s Siemens Gas Turbines Technologies –part of the Siemens group – to sign a special investment contract to localise production of heavy-capacity gas tur- bines in Russia.
Ministry representative told Vedomosti on August 9 that the application for the special investment contract had been returned to the company for revision. e deals grant companies tax breaks if they increase the amount of inputs and technology sourced locally.
Currently Siemens produces most of the gas turbines used in Russia and the lion’s share of the parts have to be imported. Russia is currently incapable of producing these turbines itself. As part of the government’s policy of autarky, it would like to develop a domestic turbine indus- try. e deal with Siemens will be held up until the government produces a new wish-list of modern technologies it wants to promote.
Siemens Gas Turbines Technologies, is a joint venture between Siemens (65%) and steel tycoon Alexei Mordashov’s Power Machines (35%) and is the only producer of large turbines in Russia.
Although Mordashov is a partner he clearly
has ambitions to develop a purely Russian tur- bine production capacity and has asked the gov- ernment in the past for state support to develop the business.
e special investment contract would allow gas turbines produced by Siemens Gas Turbines Technologies to receive the status of “Made in Russia,” and the company to gain the status of a Russian producer, which would a ect its tax regime.
To be granted these statuses the company needs to bring localisation of SGT5-2000E tur- bines to 90% by mid-2023, Prime reports.
A spokesperson for Siemens said: “So far we have not received an o cial response from the Industry and Trade Ministry on our application. At the moment, all previously announced plans remain in force.”
In late July, the Russian government ruled that companies with over 50%-foreign owner- ship could not be granted the status of a Russian company for large gas turbines. Siemens will have to drop its ownership of the joint venture to below a majority stake if it wants this status and to participate in the current Russian power plant modernisation programme.™
Australia mulls gas reserve policy
AUSTRALIA
THE Australian government will consider a nat- ural gas reserve policy as it seeks to bring down the cost of the fuel on the domestic market.
e country is set to become the world’s larg- est exporter of lique ed natural gas (LNG) in nancial year 2019-2020, with the country pro- jected to export 80mn tonnes compared with current leader Qatar’s 77mn tonnes.
e rise in shipments to foreign buyers has put upward pressure on domestic prices, how- ever, prompting both domestic and industrial consumers to induce the government to do something. Resources Minister Matthew Cana- van and Energy Minister Angus Taylor said on August 6 that they would review a range of pol- icies in order to come up with options by Feb- ruary 2021. ese will include gas reservation, pipeline access and price transparency.
“Past approvals of large gas export projects have not adequately considered the impact on the domestic gas market and that has contrib- uted to some of the pressures we have seen in recent years. We cannot a ord to repeat these past mistakes,” Taylor and Canavan said.
Canavan said thatshould a gas reserve policy be introduced it would not a ect Western Aus- tralia or existing developments. WA has had a 15% gas reserve policy in place for many years and has been cited by consumer lobby groups as an example of how local gas prices can be kept low without sacri cing investment in new export projects.
Queensland, meanwhile, has already intro- duced its own reserve policy in the form of issuing new exploration blocks that are only permitted to supply the domestic market. e state has released 39,000 square km of land for gas exploration since 2015, with almost a quarter carrying domestic marketing requirements.
Canavan and Taylor added that the Aus- tralian Domestic Gas Security Mechanism (ADGSM) would be also reviewed. e mech- anism was introduced in 2017 to prevent LNG export projects from running at a supply de cit to the local gas market. e central government also intends to put pressure on state governments to li moratoria on onshore drilling, which Can- berra hopes will bring new supplies to market.™
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w w w . N E W S B A S E . c o m Week 32 13 •August•2019