Vol 8, Issue 5 (May 2007)

Need to know

• CAR BOOT SALES

  * Finding decent assets at a reasonable price in the UK is a challenge.

• EYE ON THE BALL

  * Italian multi-stage flash specialist Fisia Italimpianti enjoyed a stunning month in May, netting two projects – the Ras Abu Fontas A phase 1 in Qatar and the Jebel Ali M Station extension on the same day (see story p24).

• MARRIAGES AND DIVORCES

  * It looks like Norit squeezed a spectacular price from private equity investor Doughty Hanson for a majority stake in the Dutch filtration company (see story p18)

• TALKING BIG

  * The real winner is Pakistan this month was Aqualyng, the Norwegian desalination plant builder, which signed a memorandum of understanding for a 94,625m³/d RO plant at Korangi.

• WEATHER CHECK

  * First quarter results have been coming with complaints about the weather.

Analysis

• The $17.7 billion global water services and chemicals market - CHART

  This pie chart comes from a slide put on the screen by Nalco chairman William Joyce at the Water Executive Forum in Philadelphia last month.

• Finding a juicy worm

  Christopher Gasson asks whether competition benefits growth.

• Insight – David Lloyd Owen

  The WFD’s shaky economic framework.

General

• $300 million wastewater overhaul for polluted Mexican river basin

  Preferential electricity rates could prove pivotal in attracting private sector investment in Lerma-Chapala’s wastewater infrastructure.

• Agbar to focus on water business after Applus sale

  Agbar is on the lookout for more foreign water acquisitions. It is hoping the imminent sale of Applus runs more smoothly than last year’s aborted attempt.

• Aguas Andinas’ $1.2bn investment programme

  Chile’s biggest water utility is not afraid to raise rates to provide capital for its ambitious wastewater programme.

• Another coup for MED at F2

  Round one goes to the International Power/Marubeni consortium, which has delivered the lowest water cost for ADWEA’s second IWPP at Fujairah.

• Aqualia increases its deal flow in Mexico

  The Spanish company’s international expansion goes from strength to strength, as Leticia Lozano reports.

• Aqualyng accelerates expansion in Pakistan

  Over the past month, the Norwegian company has signed two desalination deals in Pakistan, with a combined capacity of over 100,000m³/d. It could be the start of something big.

• Byatt calls for greater transparency to boost competition

  “The basic plumbing of water regulation seems sound,” according to Sir Ian Byatt. What can be done to tighten up the nuts and bolts?

• Covenants drive success of debut OHL benchmark

  The inaugural Eurobond from Inima’s parent OHL suffered from poor timing. It required quick thinking from the lead managers to push the deal through.

• Double desal delight for Fisia

  The MSF giant won two major contracts on the same day May. Is there more to come?

• Doughty Hanson snaps up Norit for new €3 billion private equity fund

  Doughty Hanson looks to have pipped trade buyers to the post in the Norit bidding war. It is not the first time the firm has taken exposure to the water sector.

• Filtering down through the layers

  Want to do business in Australia? A working knowledge of how government and water interact is vital, argues GWI Australia editor Max Borchardt.

• GL&V slims down and prepares for growth

  Canadian company GL&V is selling its process group to focus on the water treatment business. Its penchant for acquisitions has not deserted it, as CFO Marc Brabeau explains.

• “Green desal” in China to become a reality

  The Caofeidian plant may end up as the world’s largest desalination facility. It could also form a model for “green desalination”, as Kathy Liu reports.

• Iranian DBOs inch forward

  May could prove to be the pivotal month for a pair of water treatment plants in Iran.

• Israel’s desal programme moves up a gear

  The start-up of the Palmachim plant is the latest step in Israel’s desalination programme. Revised capacity targets mean there is still more to be done.

• Large-scale water diversion – an Australian pipe dream?

  The Bradfield Scheme has been gathering dust on the shelves of Queensland’s government offices since the 1930s. It could now be overshadowed by a new wave of water diversion projects.

• Mexico’s desalination dreams

  Following the inauguration of the Los Cabos facility, Mexico’s Pacific coast could now play host to a string of new desalination plants.

• Onwards and upwards

  Alison Ireland is already planning her October birthday celebrations.

• Perth plant heralds new era in Aussie water management

  The significance of the Kwinana plant for the nascent Australian desal industry should not be underestimated.

• Private water feels the seven-year itch

  GWI highlights the key shifts and trends which have dominated the personnel side of the private water industry since 2000. Where will the market be seven years from now?

• Report highlights rate trends and consumption disparities

  Ofwat finds value in English and Welsh water compared to European comparators – taking investment into account.

• Sachsen Wasser at work in Travnik and Kabul

  The Leipzig-based company is seeing its consultancy efforts in Easten Europe and Central Asia bear fruit.

• Tahal to invest in Chinese JV

  Tahal hopes to leverage local expertise to gain a toehold in the Chinese water sector. Participation in desalination projects will come later.

• The remains of the day

  The sale of Thames Water’s non-regulated interests includes its remaining international activities. Selling the assets as a package may prove tricky.

• The smallest big company in the business

  Aquatech survived the shake-out in the industrial water market to find itself with big prospects – and big competitors. CEO Venkee Sharma charts the way ahead.

• Veolia’s key to the US: Measurement

  Joe Burgess explains how his company is going about communicating the benefits of private water to a sceptical audience.

• Veolia’s Spanish exposition

  Veolia is taking on the Spanish at their own game – and winning. Richard Weyndling discusses strategy with the men behind the success.

• Wabag gears up for early summer sale

  After four years of losses, the company successfully returned to profit in 2006. Siemens is still keen to divest the asset.

• Water plans for peace and security in Israel

  Linking the Red Sea and the Dead Sea may bring peace, but the country is also looking to defend against terrorism.

• Winning through twinning: SAWUN’s vision

  The South Asian Water Utilities Network has a vision for improving water and sanitation in the region. It could provide business opportunities for the shrewder among its members.

Brief

• IN BRIEF – AMERICAS

  * Private water veteran Jim McGivern was unveiled in early May as the new CEO of metering giant Elster Group. McGivern was previously COO at American Water, after having worked as the head of Thames Water’s American business unit with responsibility for seeing through the acquisition of American Water by RWE/Thames.

• IN BRIEF – ASIA

  * Veolia Water has won a €17.8 million three-year contract to operate and maintain a 283,000m³/d wastewater treatment plant for the city of Chiba, near Tokyo in Japan.

• IN BRIEF – EUROPE

  * Krüger Wabag, a subsidiary of Veolia Water, expects to complete the turnkey installation of a 3,000m³/d biological wastewater treatment plant at the Technocell Dekor factory in Günzach, Germany by October 2007.

• IN BRIEF – ISRAEL

  * Veolia Environnement plans to invest $1 billion in Israel over the next five years, according to Veolia Environnement Israel Chairman Uri Starkman.

• IN BRIEF – MIDDLE EAST

  * Oman is gearing up for its fourth IWPP (independent water and power project), following the issue of consultancy tenders on 28 April.

• IN BRIEF – UK

  * A wind turbine is planned as part of Thames Water’s £400 million investment programme to improve London’s major sewage works at Crossness.

Market insight

• The financial power of IWPPs

  The Gulf power and water sector has come of age, following a string of successful IWPPs. As margins get thinner and lenders fight it out to offer the best terms, Alastair Strickland asks: where can the market go next?