Siemens Canada tells MPs it never lobbied Ottawa for sanctions waiver on Russian turbine

A top official with Siemens Canada defended the energy company’s handling of sanctions involving repair work on turbines belonging to the Russian Nord Stream 1 pipeline before a parliamentary committee on Monday.

Waiver led Ukraine to accuse Canada of giving in to Russian blackmail

Supporters of Ukraine held a rally in Ottawa on July 17, 2022 to protest the Canadian government’s decision to send repaired parts of a Russian natural gas pipeline back to Germany. (Justin Tang/The Canadian Press)

A top official with Siemens Canada defended the energy company's handling of sanctions involving repair work on turbines belonging to the Russian Nord Stream 1 pipeline before a parliamentary committee on Monday.

Arne Wohlschlegel, Siemens Canada's managing director, testified that the moment Canada imposed sanctions on Gazprom, the Russian natural gas provider, it immediately halted work on the multi-million-dollar turbine compressor, stored the unit at its Montreal facility and informed the RCMP.

Wohlschlegel described the German government's warning that the non-functioning turbine represented a threat to energy security in Europe as "an extraordinary humanitarian circumstance." 

And while Wohlschlegel acknowledged that the Canadian subsidiary warned the Global Affairs department about the "seriousness of the situation," he denied lobbying Ottawa for the controversial sanctions waiver the Liberal government eventually delivered last summer.

"These were unprecedented global events," he told the House of Commons foreign affairs committee. "But in the end, we are engineers and not diplomats."

That sanctions waiver prompted a furious reaction from Ukraine, which accused Canada and Germany of caving in to Moscow's energy blackmail. Natural gas exports are a major source of funds fuelling Russia's war machine.

"We were not in a position to balance the situation, the geopolitical situation, between [the] Canadian sanctions regime and the energy security of Europe," Wohlschlegel said.

The company, he said, simply applied for the sanctions waiver so that government officials could make that decision. 

The Commons committee has held a series of hearings on the question of whether Canada should have made that exception to the sanctions. Critics have argued the waiver weakened international resolve to oppose Russia and set a precedent that other countries, faced with similar threats, might follow.

New Democrat MP Heather McPherson said she fails to understand why the federal government hasn't dropped the exemption.

"Russia has no intention of using this turbine and in fact the weaponization of energy is part of Putin's plan for this illegal war," she said.

'This is not our decision to make'

Wohlschlegel refused to get drawn into the debate, or to say whether the Canadian government should now revoke the waiver.

"This is not our decision to make," he said. "So we're really looking at the government to instruct us."

Wohlschlegel said there are five more turbines associated with the maintenance contract, originally signed in 2012.

Conservative MP Michael Chong said there's no question the export permits associated with those units should be cancelled.

"You applied for the permit," Chong said. "That was your decision to apply for the permit. So, presumably, you have a position if the Government of Canada were to revoke the permit for the remaining five."

No work is being done on those units, said Wohlschlegel, and they are in legal limbo because Russia has refused to grant the permits for their import.

Wohlschlegel also testified that the contract with Gazprom remains "on hold" and has not been cancelled by Siemens U.K., which signed the original agreement a decade ago.


Murray Brewster

Senior reporter, defence and security

Murray Brewster is senior defence writer for CBC News, based in Ottawa. He has covered the Canadian military and foreign policy from Parliament Hill for over a decade. Among other assignments, he spent a total of 15 months on the ground covering the Afghan war for The Canadian Press. Prior to that, he covered defence issues and politics for CP in Nova Scotia for 11 years and was bureau chief for Standard Broadcast News in Ottawa.


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