Vol 12, Issue 4 (April 2011)

Need to know

• AFTER THE CRASH

  * When China announced its stimulus package for the wastewater sector at the beginning of 2009, it left us wondering whether they had added an extra zero by mistake.

• MEMBRANE PERFORMANCE

  * Pentair has bought the Clean Process Technologies division of Norit for €503 million in cash, dashing hopes that the company might be returned to the stock exchange.

• MIDDLE EAST VOLATILITY

  * Israeli desalter IDE Technologies has reported a sharp drop in sales and profit in 2010 after its construction order book slumped.

• NEW CONTRACT OPERATIONS

  * The US contract operations market had another f lat year, with the top six companies showing combined organic growth of around 1%.

• THE WIPEOUT

  * Chinese water treatment equipment supplier Duoyuan Global Water announced that it was broadening the third party investigation of its business reporting and activities, but not before research firm Muddy Waters gave its verdict.

Analysis

• Chart of the Month - 2010 revenue growth reported by selected public companies

  What do this year’s round of financial results say about the state of the global water market?

• China's membrane drain

  Charles Bodhi looks at why foreign membrane manufacturers should be afraid of the prospects of a domestic production boom in China

• David Lloyd Owen -Ofwat surprises with its most pragmatic consultation paper in decades.

  After 21 years and four Periodic Reviews, Ofwat has realised that the regulation process has become an end in itself, something that many have known for some time.

• Top market picks for 2011

  Christopher Gasson outlines what he thinks are the top ten market trends to capitalise on in the water market going forward.

General

• Americas stocks surge ahead of China

  The combination of North American water technology stocks and Brazilian utilities has enabled the GWI Americas Water Index to outpace the European and Asian water sector, despite some spectacular revenue growth in China

• Az-Zour qualifiers face thermal desal decision

  Shortlisted companies are now preparing bids for Kuwait’s first IWPP. The process will bring back to life the debate over MED and MSF technology

• Becoming a world-class water utility

  When the National Water Company took control of Riyadh and Jeddah, it could scarcely offer a water service. The scale of the improvements that have occured since then has been dramatic – but there is still more to do.

• Bidders start path to Jordan Red Sea Project

  The huge plan to desalinate water from the Red Sea and use the brine to top up the shrinking Dead Sea will be one of the biggest technical challenges of the coming years. Financial sustainability is more important to bidders.

• China applies the brakes on wastewater investment

  Did the Chinese stimulus plan crowd out future investment in wastewater? The 12th five-year plan suggests a shift in priorities towards sludge, reuse and desal.

• Cool reception for water intake regulations

  Proposed new cooling water regulations for power plants in the US could shut plants, say industry officials.

• Dhaka plans $1.6bn boost to water treatment

  Taqsem Khan, managing director of the Dhaka Water Supply and Sewerage Authority, talks to GWI about his plans to reduce groundwater abstraction and increase treatment capcity. Raising tariffs will be a key part of the strategy.

• EIB defends project financing imbalance

  The EIB’s financing for Israeli water projects dwarfs that of other Mediterranean countries. Priorities are decided by EU states, deputy director for water José Frade tells GWI.

• Emergency desal spending pays off for Israel

  Last year Israel was facing a water crisis, with drought conditions combining with stagnation at its major desal projects. A massive desalination investment plan looks likely to be more effective than authorities expected.

• Finding a way ahead for Australian water supply

  A new report from the National Water Commission recommends strategies to help keep pace with changing demands for water. Max Borchardt takes a look at the reaction of Queensland to the proposed changes.

• Global EPC spending drop hits profits at IDE

  The drop in demand for desalination projects meant the company could not reproduce the annus mirabilis that was 2009 at IDE Technologies. Completion of the Soreq plant will be key if it wants to return to normal form this year.

• Jindal takes second partner in expansion plan

  Sewage and industrial effluent reuse are the next big growth drivers in India, Jindal CEO Allard Nooy tells GWI. A new JV with Japanese firm Kobelco Eco should help capitalise on the opportunities created.

• Kemble follows AWG in Thames debt refinancing

  The refinancing of acquisition debt for Anglian Water Group has been repeated in a similar move by the owners of Thames Water, who raised £400m in a successful high-yield issue, despite residual misgivings from investors.

• Learning lessons in law

  Emma Welsh looks forward to GWI’s courses on EU legislation

• Making the case for water

  The Growing Blue inititative aims to use data to focus attention on the challenges facing the water economy. It is looking for industry

• Norit primed for US growth with Pentair

  The US has been the largest market to resist the global growth of Norit’s X-Flow technology. New owners Pentair will want this to change after the company’s low-pressure membrane business was acquired for €503m this month.

• NWC’s gift for transformation

  Saudi Arabia’s National Water Company has transformed the performance of water services in Riyadh and Jeddah. In doing so it has developed an ambitious culture of change that may take it beyond the Kingdom’s water sector

• Ofwat capital cost recovery shake up takes shape

  Will the UK regulator's proposed new approach to capital investments recovery pass the debt investor test?

• Plumbing the depths for undersea freshwater

  Stuart Todd speaks to Michael Becker of Nymphea Environnement, which claims to be able to supply fresh water from the sea at a lower cost than desalination – by tapping undersea springs. Do the economics stack up?

• Tomsk win sets Russian water operators against Veolia

  The award to Veolia of a management services contract in Russia is being challenged in court by local firms. Continued government support and further reform will be needed to avoid similar clashes.

• Valoriza focuses on international growth

  International desalination deals have taken the water division of Sacyr Vallehermoso into the big leagues in the last two years. Director-general Pablo Abril-Martorell tells GWI how he plans to keep up the momentum.

• Veolia rethinks US contract ops

  Small community contracts aren’t giving the French giant the kind of growth it needs in the US market. Is the solution to target bigger cities with a new kind of more restricted, performance-based contract?

• Water demand pushes Oman to speed up IWP

  Oman’s smoothly procured independent power and water projects have been seen as a model for the region. However, the rising needs of the local population are forcing the country to reconsider its procurement procedure.

Brief

• AMERICA WATER IN BRIEF

  * Mexican president Felipe Calderon has announced a plan to invest over $83bn in the nation's water infrastructure in the coming years.

• ASIA WATER IN BRIEF

  * The 11 March earthquake and tsunami that hit Japan’s Tohoku coast left 660,000 homes without water supplies, which have not yet been restored in many places.

• MIDDLE EAST IN BRIEF

  * The Kuwait Institute for Scientific Reseach (KISR) is to set up a $30 million specialised water research centre.

Market Profile

• Tackling the biofouling challenge

  Biofouling is one of the most significant challenges in seawater reverse osomosis desalination plants. Hiroko Kasama looks at the effectiveness of different pretreatment methods and examines the market prospects for this sector.