German technology giant Siemens has announced that it will divest its stake in the Russian company Interautomatika after receiving credible information about the illegal movement of gas turbines to Crimea.

Siemens holds a 46% stake in the Interautimatika joint venture, which provides products and services for power-plant instrumentation and control systems.

Russian state-owned businesses TPE and Rostec are the Siemens’ partners in the joint venture.

Siemens said that it has received credible information about the delivery four gas turbines for the project in Taman, Southern Russia, against contractual agreements.

It said: “This development constitutes a blatant breach of Siemens' delivery contracts, trust and EU regulations.”

The company has also started a process to terminate a license agreement with Russian companies in the area of equipment supply for combined-cycle power stations.

For the time being, it has also stopped the delivery of power generation equipment to state-controlled customers in Russia.

In addition, new contracts for gas turbine power generation equipment in Russia will be executed by its majority-owned SGTT joint venture and its wholly-owned subsidiary, OOO Siemens, Moscow.

Siemens said: “All new engagements would be subject to the new, permanent control mechanism.”

The company added that it will continue to pursue criminal charges against the responsible individuals at its customer TPE and legal actions to stop any other deliveries to Crimea.

The actions are aimed at ensuring that any equipment that has already been delivered is returned to its original destination, Taman, it said.

Siemens said that it has also renewed its offer to buy back the equipment and cancle the original contract.

It said: “In addition, Siemens is reviewing all potential collaboration between its subsidiaries and other entities around the world with regard to deliveries to Russia.”

Earlier this month, Siemens stated that it had previously taken in writing from the Russian customer that the turbines would not be shipped to Crimea, which is facing sanctions from the European Union.

Image: Siemens’ SGT5-8000H turbine. Photo: courtesy of Siemens AG.