Vol 12, Issue 9 (September 2011)

Need to know

• Data Time

  GWI’s annual tariff survey shows a healthy 6.8% increase in the average global combined water and wastewater tariff to $2.03/m3.

• Going Global

  Bio-Treat, the fallen Chinese wastewater wonderstock which reinvented itself as HanKore Environment, is broadening its market focus to include the Middle East, south-east Asia and Africa.

• IPO News

  Oman’s leading power and water generator is planning a $64 million IPO.

• Project Opportunities

  Kuwait’s Ministry of Electricity and Water has a new reverse osmosis desalination plant on the drawing board.

• Sale Season

  Japanese conglomerates Marubeni and Itochu are expected to submit final bids for Bristol Water this month, along with at least one infrastructure fund.

Analysis

• The case for corporate water

  Christopher Gasson looks at why corporate water users will never satisfy the activist community, and what they should do about it.

• Chart of the Month - New contracted desalination capacity (2007-2011)

  This month’s chart comes from the latest edition of the IDA/GWI DesalData Worldwide Desalting Plant Inventory, which was completed earlier this month.

• David Lloyd Owen - The Environment Agency has its work cut out to get ‘good’ rivers by 2027.

  The Environment Agency got a mixed reception when it announced its top ten list of the most improved rivers in England and Wales at the end of August.

• Divining China’s watergy future

  Charles Bodhi examines the stormy relationship between water and energy in China in the first of a four-part series.

• The downside of IWPPs

  An uptick in independent water projects would benefit developers. For Middle Eastern customers, the picture is not so clear, argues Tom Scotney.

• Secondary BOT market comes of age

  Recent trade in operational water and wastewater BOT assets has been brisk. What is driving the renewed activity in the sector?

General

• Balancing risks and rewards in Indian water

  For the Indian government’s new focus on service delivery to work, it will need to re-assess the allocation of risk within existing contract structures.

• Developers baulk at offtake price

  Only one out of the three developers approached by the Israeli government to expand desal capacity at existing sites has submitted a formal proposal.

• Great expectations in India’s water sector

  Improving service delivery will be a key element of India’s forthcoming Five-Year Plan. Jeremy Goad examines the implications of the government’s new approach for the future of the country’s water infrastructure.

• Industrial work tops global ambitions at IDE

  After a period of untrammelled success, IDE Technologies is now adjusting to life in a post-financial-crisis world. Working with the global industrial sector may offer the best hope for growth.

• Israel pays the price for its military past

  A massive clean-up operation at a contaminated military site near Tel Aviv will involve advanced water treatment technologies. The government wants to re-develop the site as prime real estate.

• Japanese set sail in Bristol fashion

  The structure of the Bristol Water sale seems to have put some investors off. Japanese trading companies are among the few left in the running.

• K-water steps onto the global stage

  Korea Water Resources Corporation is putting its balance sheet on the line to kick-start an ambitious international expansion programme. It has identified ten target markets.

• Moya takes the direct approach

  Moya Asia has turned a corner with its first BOT win in Indonesia. It is divesting its Chinese BOTs to free up capital.

• Oman IWPP hits the market with $64m IPO

  The largest power and water supplier in Oman has initiated bookbuilding ahead of a 35% stock sale. A $100 million construction dispute is thought to be behind the year-long delay in listing.

• Osmoflo raises its game with GE deal

  A strategic alliance with GE will help free up the Australian desalter to pursue larger projects in future. Max Borchardt reports from Perth.

• Out of sight, but not out of mind

  China has released its first official policy document addressing groundwater contamination. It is long overdue, argues GWI’s China editor Kathy Liu.

• Rejuvenated and hankering after profit

  Chen Dawei, CEO of HanKore Environment, explains to GWI how he is getting the company back on its feet.

• RWE faces up to watered-down portfolio

  RWE may be forced into selling two of its remaining water operations as part of an enlarged €11 billion divestment programme. The buyers will dictate the timetable.

• A scheme in urgent need of renewal

  GWI’s Rama Rastogi assesses the progress of India’s JNNURM in improving urban water infrastructure, and looks ahead to its possible successor.

• Second IWPP means new EPC plans for Kuwait

  Plans for a second privately financed power and water project in Kuwait will come as good news for developers starved of BOTs in the region. A new reverse osmosis plant at Doha will satisfy the country’s short-term needs.

• Spanish lessons for the global curriculum

  The changes ushered in by Spain’s Socialist government have revolutionised the country’s water supply situation. Secretary of state Josep Puxeu talks to Richard Weyndling about the challenge of finding new sources of funding.

• Tackling EECCA’s infrastructure legacy

  Measures brought in over the last ten years to transform the water sector in Eastern Europe have had a mixed impact. A new report from the OECD takes stock of the lessons learned, and charts the path ahead.

• Water rules OK!

  Emma Welsh considers the importance of GWI’s new regulation report.

• YSI buy may boost analytics M&A

  The heated competition to acquire fast-growing analytics company YSI Inc. could make others in the sector re-assess their holdings.

Brief

• AMERICA WATER IN BRIEF

  * A bill paving the way for the Sacramento Regional County Sanitation District (SRCSD) to sell recycled water on the open market was passed into law on 6th September by California governor Jerry Brown. Assembly Bill 134 means the SRCSD can apply for a permit to sell approximately 180,000 acre feet per year (608,300m3/d) of highly treated recycled effluent to downstream users, thus obviating the need for massive rate hikes.

• ASIA WATER IN BRIEF

  * Singapore-listed companies Moya Asia and Asia Environment Holdings have disposed of their 50% and 25% stakes in loss-making Pizhou Water for US$900,000 and US$450,000, respectively.

• EUROPE WATER IN BRIEF

  * As GWI went to press, the Greek government was expected to announce imminently the names of the advisers which will oversee the sale of strategic stakes in the country’s two listed water utilities, EYATH and EYDAP. The divestment of 40% of EYATH is still timetabled for later this year

• MIDDLE EAST WATER IN BRIEF

  * The 160,000m3/d Muharraq wastewater BOT officially reached financial close on 14 September.

GWI Water Index

• Water stocks recover their composure

  After last month’s carnage, water stocks more than held their own against the benchmark MSCI World Index this month. Wabag fared the worst, as investors knee-jerked over the company’s perceived exposure to Libya.

Market Profile

• Global water tariffs continue upward trend

  A 6.8% rise in global water tariffs masks significant changes in the way local authorities calculate their rates. David Zetland gets behind the numbers.