Christian Bruch: ‘The launch of the CCGT-TPP at NKNK is especially important during the Year of Russian-German Energy Cooperation’

Siemens initiated the meeting

The teleconference connected Germany, Moscow, Kazan and Nizhnekamsk. TAIF JSC Director General Ruslan Shigabutdinov chaired a big online delegation of TAIF Group. Chairman of TAIF JSC Board of Directors Albert Shigabutdinov presided over the meeting. Their long-term partners from Germany, a Siemens Energy team headed by the company’s President Christian Bruch were on the other side of the screen.

“Taking advantage of this opportunity, I want to express my gratitude to you for presenting such a proposal. The situation around the world isn’t easy. I thank you for the opportunity of discussing today’s situation regarding the course of implementation of our projects,” Albert Shigabutdinov stressed at the beginning of the meeting. He also introduced TAIF Group participants in the meeting — the management and specialists of TAIF JSC, Nizhnekamskneftekhim PJSC, Kazanorgsintez PJSC and TGC-16 JSC.

Christian Bruch, in turn, introduced the team of Siemens Energy, which included heads of offices and divisions that are involved in the implementation of TAIF Group’s projects.

“Indeed, it isn’t an easy time for none of us. The projects that are implemented are quite complex, and with the additional complexity of the pandemic. It is a huge challenge. So I appreciate the possibility of discussing where we stand, opportunities for collaboration in the future. I am looking forward to today’s discussion. Thank you for your openness and trust,” the president of Siemens Energy noted in his reply.

The Siemens Energy president also took advantage of the occasion to congratulate the participants in the meeting with TAIF Group’s recent 30^th anniversary. He emphasised that it was “a milestone both for your employees and for us, your partners”. While the cooperation with TAIF Group occupies a special place in Bruch’s soul.

“When I moved into my new office (Editor’s Note: Christian Bruch chaired Siemens Energy by transitioning from an executive post in another big German company Linde), I put all the memories from TAIF and Tatarstan onto my shelves. And it is a very positive experience over the past years when I was in Kazan, Nizhnekamsk. It is a part of my personal memory, and I am very glad that at Siemens Energy I have an opportunity to continue to work with you,” Christian Bruch stressed.

CCGT-TPP is due to be put into operation in summer of 2021

The construction of the 495 MW CCGT-TPP at Nizhnekamskneftekhim PJSC — a crucial energy facility to develop Tatarstan’s oil refining and petrochemical complex, which, in turn, is important and valuable for Russia’s economy in general — became the first topic for discussion at the meeting.

“As for the construction of the CCGT-TPP together with Siemens, many processes are 87-100% complete. Now we are entering an active phase of start-up and commissioning,” Director General of Nizhnekamskneftekhim PJSC Ayrat Safin told the participants in the meeting.

TGC-16 JSC is the client of the CCGT-TPP construction on behalf of Nizhnekamskneftekhim PJSC.

The TAIF JSC management made sure of this personally after recently visiting the facility. Nonetheless, there are topics to discuss after the recent inspection of production and construction sites. Firstly, it is necessary to achieve the perfect order both on the construction site and in work. Albert Shigabutdinov addressed this message to both his colleagues from Nizhnekamsk and contractors, which are foreign companies.

“We take your comments seriously and will take actions to fix the situation,” President of the company Christian Bruch promised on behalf of Siemens Energy.

Secondly, it is necessary not to slow the pace down:

“For somebody a crisis is death, a fall, for others, it is a time to expand capacities and grow. I offer you to accelerate the work and keep to the schedule, which didn’t have room for coronavirus,” the TAIF JSC board chairman urged.

The delay caused by the pandemic is relatively short. According to the schedule, the first gas turbine fire was already due to be in early April. The remaining gas and steam turbine will consecutively be launched in test mode. The plant is to start operating in commercial mode this summer.

“A big amount of as-built documentation and start-up and commissioning programmes will have to be approved by Russia’s industrial safety watchdog, with the system operator, with Group of Companies,” Vice Director General of Information Technologies and Energy at TAIF JSC Ruslan Gizzatullin took the floor. Both teams involved in the project will have to do the work together and as soon as possible.

The plant will run on natural gas in test mode first, Nizhnekamsk no longer has a deficit of gas, and no shortage is expected at least in the next few decades. There is no deficit thanks to a new gas pipeline built by TAIF Group and launched last summer. Then the plant will use synthetic gas — a hydrogenated petrochemical by-product. It is the latest technology Siemens tested for the first time when making turbines precisely for Nizhnekamskneftekhim’s CCGT-TPP. This will allow significantly reducing the environmental impact.

“Huge attention is paid around the world to the use of hydrogen in power engineering. All the largest companies — Mitsubishi, Siemens, General Electric — invest a lot of money in research on the use of hydrogen-containing gas in energy. And this project (Editor’s Note: the 495 MW CCGT-TPP) moves in this direction, as precisely gas with high hydrogen content will be used here as fuel. Syngas is the main production’s by-product, which used to be burnt in flares. It is a double advantage,” the vice director general of information technologies and energy at TAIF JSC emphasised.

Energy facility of paramount importance

“The launch of the power plant at Nizhnekamskneftekhim is of the utmost importance to both TAIF Group, Nizhnekamsk and the Republic of Tatarstan and Russia in general. It is one of the biggest energy projects in the country. After putting this facility into operation, we guarantee stable development in the republic in the next 20-30 years,” Albert Shigabutdinov stressed.

Success is no less important for Siemens Energy. Nowadays for the German company, it is the biggest project in Russia and its first EPC contract (Editor’s Note: EPC stands for Engineering, Procurement and Construction, a form of contract in the construction industry where the contractor performs functions of the client, in other words, the contractor builds a facility under a turnkey contract).

The implementation of the project is carefully overseen at the top both in Russia and Germany. Moreover, this attention hasn’t reduced since the signing of the contract. Christian Bruch reminded the audience of this at the meeting:

“It is a completely special project that must be implemented at a high level. I recall the Siemens, Linde management put their signatures then in Saint Petersburg. You, Rustam Minnikhanov, Horst Seehofer, Vladimir Putin were there. It was a special event when we launched this project, so it will be a very special event when we celebrate the finalisation,” he noted and added, “I also do agree with you that the political importance of this project is special. We see the project has a special role, especially now during the Year of Russian-German Energy and Sustainability. I think our project is a lighthouse of this programme. I am sure with our project we should demonstrate an example of the successful partnership between Russia and Germany in energy,” the Siemens Energy president emphasised.

Nothing should influence the launch of EP-600 complex

The wish not to slow down the pace despite the influence of the pandemic and put everything in order applies to another big project implemented by TAIF Group within its development strategy — the construction of EP-600 ethylene complex. Nothing should influence the launch of this key petrochemical facility. In this respect, now it is necessary to ensure once again that all nuances and moments are taken into consideration, including supplies of necessary materials and equipment.

The Nizhnekamskneftekhim PJSC director general informed the audience about the course of the construction of the ethylene complex and the participation of Siemens Energy in the project in detail:

“Siemens was to supply three compressors: a pyrogas compressor, an ethylene compressor and a propylene refrigeration compressor. They all have been supplied. There are no remarks on the construction site anymore. There are also electric equipment and materials. They will arrive in the middle of summer,” he said.

“Mr Bruch, I would want very much your specialists, Linde and Nizhnekamskneftekhim specialists to inventory the supplies of Siemens equipment to this site. The equipment was supplied according to the basic design, today the elaboration of documentation is nearly complete, and it is necessary that people in charge inventory the specifications: what was necessary, what has been supplied, what else should be purchased and when it will be delivered. The amount of Siemens equipment is big there, and by our next meeting, we need to fully understand the procurement of EP-600 complex,” the board chairman of TAIF GC addressed the president of the German company.

“By our next meeting, we and Linde promise to approve and inventory equipment with Nizhnekamskneftekhim to make sure nothing has been lost and we will miss nothing,” Christian Bruch responded immediately.

It should be reminded that EP-600 with over 1,8 million tonnes of straight-run gasoline a year is the first and yet the only biggest liquid pyrolysis complex in Russia’s modern history. Besides 600 tonnes of ethylene, it is planned to manufacture 273,000 tonnes of polypropylene, nearly 250,000 tonnes of benzene, 88,000 tonnes of butadiene, 64,000 tonnes of butylene-isobutylene fraction, 65,000 tonnes of C5 fraction and 17,000 tonnes of C9 fraction as well as 93,000 tonnes of pyrolysis tar a year and almost 350,000 tonnes of methane-hydrogen fraction. Such large facilities weren’t built even during the best years of the USSR’s active industrialisation. During a recent visit to Nizhnekamskneftekhim Albert Shigabutdinov stressed:

“After the implementation of the programme, Nizhnekamskneftekhim will become one of the biggest petrochemical companies. I think it will be the only enterprise in the world to produce over 3,5 million tonnes of polymers in one facility. Moreover, the range of polymers is very wide — 331 types. And the refining of high-quality feedstock made of crude oil will be the peculiarity of the complex.”

The olefin complex construction project began in June 2017. A memorandum of understanding was signed at Petersburg International Economic Forum between TAIF Group and Germany’s Linde AG, and an agreement on the design, supply of equipment and services to launch the first stage of the would-be complex was signed between Nizhnekamskneftekhim PJSC and Linde Engineering.

The scale of the project was so large and important so that it was included in Russia’s petrochemical development strategy, while nuances of the agreement between TAIF Group and Germany’s Linde AG became a topic for discussion for President of Russia Vladimir Putin and President of the FRG Walter Steinmeier.

A strategic development programme of Nizhnekamskneftekhim PJSC through 2025 envisages the launch of new refining capacities: to not only augment the amount of production but also obtain huge capabilities to master new areas and to create more than 2,500 new jobs with a decent salary, including 600 jobs in the EP-600 alone.

Such a significant expansion of production and scheduled manufacture of new products will help develop not only TAIF Group in general but also benefit the republic and the country in general. The olefin complex that’s is under construction means a considerable rise in taxes and payments to all budget levels (municipal, republican and federal), it is the creation of new infrastructure, including roads (highways, railways, bridges), a new impulse for housing development and construction of social infrastructure. Moreover, it will become a driver for the appearance and development of a number of plants manufacturing end commodities in Tatarstan and Russia in general, which will use polymers produced in the new complex. A huge synergistic effect is expected from a development strategy of Kazanorgsintez PJSC as well.

During the teleconference, the TAIF Group management told its foreign partners about big plans in the following five years and offered Siemens Energy to participate in Group’s future projects.

TAIF offers Siemens to split the strategic agreement

The memorandum of understanding signed between TAIF Group and Siemens in 2014 and extended in 2018 also became one of the topics for discussion via teleconference. A lot of events have taken place since then, including Siemens Energy became an independent part of Siemens AG.

“As you had a reform at Siemens, and Siemens Energy became independent, we would like to establish our relationships as systematically as they are established with Siemens AG. In this respect, it would be correct to sign a memorandum of understanding between TAIF Group and Siemens Energy to fix all key principles of our joint work, including in pricing of products and components of Siemens Energy and appoint people in charge of this,” the TAIF board chairman voiced a proposal.

“Thank you very much for raising this issue. I will personally take care of it to do this as soon as possible. It is a very good idea to sign a cooperation agreement. Oleg Titov (Editor’s Note: director general of Siemens Energy in Russia) will coordinate this on the Russian side, while I will personally supervise the process and talk with Roland Busch, the CEO of Siemens AG, our main shareholder,” the Siemens Energy responded to the offer.

At the end of the meeting, Albert Shigabutdinov put forward another proposal to his German partners:

“It will be necessary to reinforce Siemens maintenance subdivisions in Russia, including in programming and process automation. We would like our and your specialists to discuss this and intensify the work in this area. I am convinced that this would help avoid possible technical and manmade accidents and allow us to work more effectively and reliably,” noted the board chairman of TAIF JSC.

This proposal was approved and supported by the management of Siemens Energy as well.

Next time the participants in the meeting agreed to teleconference in late March. However, the president of Siemens Energy expressed his hope that the situation due to the pandemic would soon improve so much that personal meetings were possible too. On this occasion, Christian Bruch invited the management of TAIF JSC and Group’s companies to Munich where Roland Busch and Joe Kaeser, who is chairing the board of Siemens Energy today and has long-term and friendly relations with TAIF Group and Albert Shigabutdinov personally, are also looking forward to meeting with them.