ATLANTA--(BUSINESS WIRE)--GE Energy (NYSE: GE), a global leader in power generation technologies, and OJSC NPO Saturn, a leader in the machine building and jet engine industries in Russia, have announced their intent to invest and cooperate in a joint venture in the heavy duty gas turbine industry.
Initially, the two companies intend to produce GE heavy duty gas turbines in the 40-150 megawatt range in Russia, with the active participation of NPO Saturn. GE Energy also is considering a strategic investment in the industrial gas turbine division of NPO Saturn.
Jeffrey Immelt, GE's Chairman and CEO, and Yury Lastochkin, Saturn's General Director, have met to discuss the priorities of the long-term strategic partnership. According to Sergey Chuklinov, Deputy Director of NPO Saturn, the negotiations have opened the way for on-going cooperation between the two companies.
Upon completion of the agreement, GE gas turbine technology would be licensed to the joint venture, and the combination of Saturn's turbomachinery expertise and GE's global supply chain quality processes would make state-of-the-art gas turbine products available to customers in Russia.
The joint venture would draw equally on the strengths of GE and Saturn. GE initially would infuse technology, NPO Saturn would lead the partnership in meeting Russia's rigorous industry standards, and both companies would develop the JV's in-country supply base and manufacturing capability.
Initially, the JV would bring GE's B, E and F-class gas turbines to Russia. "We have selected this range of gas turbines because we believe they best fit the broad needs of Russian industry today. These turbines offer substantial fuel flexibility and world-class levels of availability, reliability, emissions and efficiency," said John Krenicki, President and CEO of GE Energy.
"This is only a starting point in our relationship, and we intend to build in the flexibility to ensure that not only do we offer the competitive products needed for today, but also the larger gas turbines required for the future," he added.
"This is an exciting time to be in Russia, and we are pleased to work with Saturn, which brings so much industry experience. We look forward to a long and prosperous relationship, with both parties focused on delivering world-class products to support Russia as it modernizes and expands its energy industry," said Rod Christie, GE Energy Region Executive. "In accordance with official Russian data, we recognize the demand to install more than 20 gigawatts of new generation capacity in the next 5-10 years."
According to Sergey Chuklinov, NPO Saturn is completing "an enterprise restructuring process with the goal of realizing the future fulfillment of this strategic partnership with GE and the technical upgrade of the enterprise to achieve world class standards."
GE Energy has a long history of operation in Russia, dating back to the supply of steam turbine technology in the 1920s. The company recently has delivered products in the power generation, district heating, combined heat and power and transmission and distribution sectors. Currently, GE has over 400 frame gas turbines operating in oil and gas applications in Russia and 100 gas engines in cogeneration projects, and is contracted to install gas turbines in various industrial and municipal applications.
Last month, GE Energy opened a new application center in Moscow to support customers seeking to develop projects based on state-of-the-art technology. The facility is an important part of GE Energy's commitment to Russia.
"In the 1920s, GE brought the latest technology of the age to assist in the State Electrification of Russia Program...and today, we are proud to bring advanced technology to assist in the development of the power generation industry, working with the leader in this sphere, NPO Saturn," said Ron Pollett, President of GE Russia/CIS.
About GE Energy
GE Energy (www.ge.com/energy) is one of the world's leading suppliers of power generation and energy delivery technologies, with 2005 revenue of $16.5 billion. Based in Atlanta, Georgia, GE Energy works in all areas of the energy industry including coal, oil, natural gas and nuclear energy; renewable resources such as water, wind, solar and biogas; and other alternative fuels. Numerous GE Energy products are certified under ecomagination, GE's corporate-wide initiative to aggressively bring to market new technologies that will help customers meet pressing environmental challenges.
About NPO Saturn
Scientific-production association "Saturn" is a multi-profile specializing in the development, production and servicing of gas turbine products. "Saturn" works on all sectors of this industry and on all main segments: civil aircraft engines, gas turbine units ranging from 2.5 to 110 MW for power and heat generation, gas pumping units and marine gas turbine units. It employs 18,000 people, including 4,000 who are involved in research and development activities.
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