Iran breaks western monopoly, strikes a deal to supply 40 gas turbines to Russia

Iran and Russia have signed an export agreement on supplying 40 gas turbines to Russia. In spring, Russia included Iranian-made MGT-70 gas turbine units in the list of equipment that is not subject to value added tax when imported.

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Joseph P Chacko
Joseph P Chacko
Joseph P. Chacko is the publisher of Frontier India. He holds an M.B.A in International Business. Books: Author: Foxtrot to Arihant: The Story of Indian Navy's Submarine Arm; Co Author : Warring Navies - India and Pakistan. *views are Personal

Iran and Russia signed an export agreement on supplying 40 gas turbines to Russia, Managing Director of the Iranian Gas Engineering and Development Company (IGEDC) Reza Noshadi said on October 23. In spring, Russia included Iranian-made MGT-70 gas turbine units in the list of equipment that is not subject to value added tax when imported. 

In June, Konstantin Molodkin, deputy engineer of PJSC RusHydro, told the expert council of the State Duma on import substitution in the energy sector that the company is considering the possibility of ordering turbine units from foreign suppliers, especially from Iran.

OJSC Power Machines( Siloviye Mashiny or Silmash and United Engine Corporation (UEC) have plans to create these turbines, he said, adding that there are no instances of mass manufacturing and the developed plans have extremely limited production capacity. Furthermore, current capabilities are insufficient for expanding gas turbine production in the future years, he said.

RusHydro needs turbines for its thermal power plant modernisation project in the Far East. The company plans to upgrade four power plants with a total capacity of up to 1.3 GW (Khabarovskaya CHPP-4, Artyomovskaya CHPP-2, Yakutskaya GRES-2, Vladivostokskaya CHPP-2).

Iranian MGT-70 gas turbine

Manufactured by Mapna Industrial Group, the MGT-70 version 3 has an output capacity of 185 MW. It is an upgrade of the Siemens SGT5-2000E (V94.2) gas turbine. The MGT-70 turbine has been used to construct Iraq’s Ramila combined cycle power plant. The project uses 12 MGT-70 turbines bought at $2.5 billion. 

According to Abbas Aliabadi, the chief executive officer of Mapna Group, the E-class turbines are one of the most popular gas turbines in the world. However, none of the products of prominent companies such as GE, Siemens, and Ansaldo in this class has the 36.4% efficiency of the new Iranian MGT-70(v3), and the best comparable products have the same efficiency. He said in 2019 that the western turbines had an efficiency of 36 to 36.2%.

Other turbines produced by the company are MGT-40 (42 MW), MGT-30 (25 MW), MST-50C (160 MW), MGT-20 (14 MW) and other smaller turbines with 5 to 20 MW capacity.

In the late 1970s and early 1980s, Mapna Group acquired the transfer of technology of E-class turbines from various companies worldwide. MGT-75 is the latest version of the E-class turbine developed by the company. 

The holding produces mainly licensed models by Siemens or modifications. 

Iranian progress in Gas turbines

Reza Noshadi, while explaining the progress, opportunities, and challenges of the gas industry at the meeting of the Basij Aqshar organisation, stated that the industrial successes of the country are not limited to the fields of missiles and drones and that 85% of the facilities and equipment required by the gas industry are now manufactured in Iran. Based on this capability, a contract (with Russia) was recently signed for the export of 40 Iran-made gas industry facilities and equipment.

He announced using an Iranian control system for the first time in the country at the Khormoraj gas pressure boosting station. He said that Iranian technology is based on eastern and western technology transfers. Iran has reached a point where domestic turbines are more efficient than similar foreign turbines, he claimed.

The CEO of Iran Gas Engineering and Development Company pointed out that Venezuelan oil production fell after the sanctions, but Iranian oil production increased. He also pointed out that the US is a net oil exporter after sanctioning Iraq, Libya, Iran, Venezuela, and Russia, the owners of 50% of the world’s oil reserves. 

While analysing the disruption caused by the United States in the world gas trade, he said that in recent years, the United States has built a large number of LNG production facilities, and more recently, with the total embargo on Russia and the explosion of the Nord Stream gas pipeline, it is essentially one of its largest rivals.

In February, during his visit to the Noshadi listed Naft Turbocompressor Company, he said that Iran had become the seventh turbine manufacturer in the world.

Sanctions bring Iranian companies into the Russian market

In 2017, Iran failed to get contracts for the Crimean power plant under sanctions from the European Union. The issue was the Russian cooperation with Siemens, which included a joint venture for producing the turbines. If Russia had purchased Iranian turbines built with Siemens technology, it risked many projects which required European equipment.

However, Iranians claim they have a secondary market for turbines they have purchased and manufactured. Without mentioning the turbine, the Iranians said that they had modernised them to such a degree that it is difficult to refer to them as the turbines of the maker.

Since Russia is now subject to sanctions, Iranian firms, particularly Mapna, have a good possibility of supplying, maintaining, and even upgrading turbines already installed in the Russian market.


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