Vol 11, Issue 10 (October 2010)

Need to know

• THE COST OF DESAL

  * The Victoria Department of Sustainability and Environment has published details of the costing of the desalination plant at Wonthaggi – serving Melbourne – which makes it possible to come up with a projected water price for the desalinated water.

• ASIAN ACTIVITIES

  * Tyco International has decided to focus its water business on the Asia Pacific region by selling its European valves and fittings unit to private equity house Triton for $245 million.

• CLEAN ENERGY?

  *Tunisian wastewater utility ONAS has decided to go on the offensive to cut its energy bill, which has grown dramatically as the number of wastewater treatment plants in the country has mushroomed from 52 to 106.

• WASTEWATER WORLD

  * The growth of the wastewater treatment sector has been most dramatic in China.

• ESSENTIAL ASSETS

  * Macquarie Essential Assets Partnership has decided that its 33.33% equity position in Aquarion is not an essential asset after all, and is looking for a buyer.

• SAUDI ACTION

  * Saudi Arabia’s National Water Company has rejigged its plans for privatising its distribution networks and its wastewater treatment plants.

Analysis

• No more thermal desal?

  Christopher Gasson asks whether Saudi Arabia can continue to divert an increasing portion of its oil output to water production.

• David Lloyd Owen - The value and values of engineers.

  The 3rd Oxford Water Membrane Event was a thoroughly useful update on how membranes are being developed and finetuned for desalination and water and wastewater treatment.

• Chart of the Month - Top ten desalination plant suppliers by capacity, since 2000

  This month’s chart is taken from the new IDA Desalination Yearbook.

• Living happily never after

  You need to pay if you want to play in China’s current water market, writes Charles Bodhi.

• Bridging the connection gap

  To what extent are connection charges an obstacle to the extension of water services in low-income countries? Christopher Gasson looks for answers in GWI’s first ever survey of connection charges.

General

• Oil on troubled waters

  Emma Welsh is excited about the opportunities in oil and gas.

• Finding the funding balance in Spain

  Funding compliance with EU directives is one of the most pressing issues facing the Spanish Environment Ministry. GWI’s Richard Weyndling talks exclusively to the director-general for water, Marta Moren.

• Reining in Spain’s rebellious regions

  The proposal by Spanish Socialists to create a national water authority could rein in regional conflicts over scarce water resources. It has the backing of the irrigation community.

• Financing Kuwait’s IWPPs

  Developers in the desal world are licking their lips over the upcoming IWPP in Kuwait. What about the international banks?

• Pressure grows for Saudi tariff reform

  The heavy subsidising of water supplies in the Kingdom has been accused of holding back development. Now, the water minister has given the clearest sign yet that change is on the cards.

• Treated effluent sales key to privatisation

  An upcoming TSE sale contract gives a hint of the potential earnings for private partners in Saudi Arabia.

• New timeline for Saudi water management

  Saudi Arabia has outlined a new roadmap for managing and privatising its treatment and distribution assets. The crucial details that will determine its appeal to the private sector have still to be decided.

• DEWA’s $2 billion bond bonanza

  The Dubai Electricity and Water Authority has extended the average maturity of its debt profile by tapping into robust demand from fixed-income investors. It has a lot of short-term commitments to meet.

• Turning Tunisia’s wastewater green

  Fitting WWTPs with biogas co-generation facilities should enable ONAS to reduce its energy budget. Carbon credits will be the next step.

• The flip-side of lower consumption

  An Israeli government drive to cut domestic demand has seen positive results. It also means treated wastewater is now in short supply for farmers.

• Veolia discovers the Environnement

  There is a difference between being an environment-related business and making a business out of improving the environment. Veolia is positioning itself as the latter, and has launched two new initiatives to support its claims.

• Severn Trent well equipped for growth

  Severn Trent Services feel is feeling confident of the future as its investments begin to pay off.

• Wabag takes a bow on the public stage

  Following a highly successful $107 million IPO, Wabag managing director Rajiv Mittal clearly has options when it comes to growing the business. Being a plant developer is only part of the story.

• New directions in Chinese wastewater

  Almost 90% of China’s cities now benefit from their own major wastewater treatment plants. It suggests that the days of the big city-wide wastewater deals may be coming to an end, writes Kathy Liu.

• Tariff hike sees PBA shares hit 17-month high

  Commercial water tariffs in Malaysia’s Penang province will go up by 27% in November – the first rise in 10 years. The incumbent supplier’s profits are set to soar.

• Sumitomo escalates global water expansion

  The industrial heavyweight has concluded a deal with Beijing Capital to enter the Chinese water sector. It is the strongest signal yet that the group’s new water infrastructure unit is serious about international expansion.

• MDB plan to benefit water rights investors

  A new document aimed at securing the future of Australia’s Murray-Darling Basin looks to be good news for holders of high-security water entitlements. Not everyone is happy.

• Hatch opens new avenues for growth

  The water division of Canadian consulting engineer Hatch has relied on organic growth to get to where it is today. Now, the traditionally risk-averse company is exploring new approaches. Global director Hu Fleming talks to GWI.

• Tyco’s water business eyes higher margins

  Having sold Earth Tech to AECOM in 2008, Tyco has now shed its European water arm to a private equity house. It should not be read as a sign that the group is exiting the international water business.

• Testing the waters in new markets

  Regulatory drivers mean that the addition of analytics to ITT’s water portfolio makes perfect sense. The company’s fixation on becoming an integrated solutions provider is less convincing.

• Assessing CWCO’s vulnerability

  Consolidated Water is looking increasingly like a takeover target.

Brief

• EUROPE WATER NEWS IN BRIEF

  * The IPO of HaloSource on London’s Alternative Investment Market raised £50 million, including £31.5 million of new money, valuing the company’s equity at £100 million ($158 million).

• MIDDLE EAST WATER NEWS IN BRIEF

  * The head of the Israeli Water Authority’s desalination division, Avraham Tenne, indicated at the EuroMed conference in Tel Aviv that the country’s installed desalination capacity could realistically climb to 4.8 million m3/d by 2040, from 1.2 million m3/d at present. He added that eight potential plant sites are under evaluation.

• ASIA WATER NEWS IN BRIEF

  * Shares in Nasdaq-listed Chinese water systems integrator Tri-Tech Holding received a boost in early October after the company announced that it had won an EPC contract for a 96,000m3/d drinking water plant in Inner Mongolia.

• AMERICAS WATER IN BRIEF

  * The Cayman Islands Government will release an RFP on 18 October for the privatisation of its wastewater assets.

Market insight

• A step in the right direction

  Chile´s new administration is promoting better information and transparency in the water rights market as a way to make it more liquid and tradeable. There is still plenty of work to be done.

GWI Water Index

• Water index posts 9% monthly gain

  A 9% jump in the GWI Global Water Index is the biggest monthly rise since April 2009. Who were the winners and losers?