Aquaindustry session: Outsourcing

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1 Aquaindustry session Outsourcing Aquaindustry session: Outsourcing Tuesday, November 1st, 2011 (14:00 15:45) Four Speakers on Outsourcing: Global Water Intelligence - Christopher Gasson Evides - Sjack van Agtmaal Sembcorp Bob Taylor Aquatech International Corp - Nitin Shinde

Outsourcing: Global Water Intelligence - Christopher Gasson Evides -

2 Industrial Outsourcing in NL Sjack van Agtmaal IWW - Aquaindustry session: Outsourcing Tuesday, November 1st, 2011 (14:00 15:45) Content: Introduction Outsourcing Examples Conclusions

Introduction Rotterdam Main port of EU 500 km 160 Million people Introduction Evides Water company - Credentials Municipality of City and Port of Rotterdam Integrated utilities, both drinking and

3 Introduction Rotterdam Main port of EU 500 km 160 Million people Introduction Evides Water company - Credentials Municipality of City and Port of Rotterdam Integrated utilities, both drinking and industrial treatment service company (process & waste ) 13,500 km transportation & distribution pipes Water supply: 270 Mm 3 per annum (of which: 100 Mm 3 to the process industry) Turnover: approx 300 M

industrial treatment service company (process & waste ) 13,500 km transportation & distribution

4 Definition Outsourcing & DBFO Contracts Definition: Outsourcing? Uitbesteding, soms aangeduid met de Engelse term outsourcing of het vernederlandste outsourcen, is de uitvoering van een proces als gevolg van een strategische keuze door een organisatie, om één of meer bedrijfsactiviteiten uit te besteden naar een dienstverlenende onderneming of toeleverancier. Outsourcing is a collaboration between companies, while maintaining own identity and responsibility, in order to realize a project on the basis of clearly addressed task and risks. These agreements are compiled and agreed upon in a DBFO contract (Design, Build, Finance & Operate).

keuze door een organisatie, om één of meer bedrijfsactiviteiten uit te besteden naar een dienstverlenende onderneming of toeleverancier.

5 Starting points Industrial Outsourcing A Company decides to outsource in order to focus on its core business Outsourcing is always a management (strategic) decision The Company selects supplier(s) with added value & reputation in the outsourcing collaboration Both Companies are rewarded via rendered added value monitoring via KPI s Fundamentals success: trust between Companies Partnership via transparency in actions and individual quality of the partners DBFO contracts Design, Build, Finance and Operate Benefits for the Client + Focus on core business + Fixed prices / m 3 + Forecastability of costs + In full control of budget + Extra liquidity (no CAPEX) EPC Project Management Engineering Procurement Technologies / OEM Civil construction E&I&M construction SPC Contract DBFO Contract Contract management Finance Legal structuring Risk management O+M Operational Excellence Online process monitoring Process optimization Trouble shooting Administration Invoicing

transparency in actions and individual quality of the partners DBFO contracts Design, Build, Finance and Operate Benefits for the Client + Focus on core business + Fixed prices / m 3 +

6 Pro and Cons of DBFO Pros: Financial savings Focus on Core business Efficiency Risk sharing Innovation Effective operations (financial incentives) (Time) management Quality assurance Cons: Economies of Scale Dependence of third party Battery limits discussions Decline of operational Know- How & Not innovative (Risk averse) Money is the only driver, less attention paid to technology or people Massive number contractuals Examples of DBFO Contracts The Netherlands 1. First DBFO in NL 2. Essent Chemelot & Moerdijk 3. Evides Dow Terneuzen 4. PPP Delfluent 5. Evides DWP Rotterdam

operational Know- How & Not innovative (Risk averse) Money is the only driver, less attention paid to technology or people Massive number

7 First DBFO in the Netherlands Amsterdamse DuinMaatschappij 1851 Amsterdamse Duin-Maatschappij (ADM) Entrepreneur & writer Jacob van Lennep (with English financiers & engineers). Startpoint: success municipal supply in London city & fact ± people died of cholera in NL (1832 & 1867). Within two year ADM provided the first drinking pumped from the dunes near Vogelzang via cast-iron pipes to Willemspoort. The first sales had a value of one cent per bucket City of Amsterdam bought ADM for 12 Million guilders and developed the services & company to nowadays Waternet. Industrial DBFO projects

Within two year ADM provided the first drinking pumped from the dunes near Vogelzang via cast-iron pipes to Willemspoort.

8 WKC Swentibold EdeA - Geleen Electric Power: 233 MWe Max. demin : 1700 m3/h Max. steam supply: 1000 t/h (HP & MP) WKC Moerdijk (2005) Installated Power 340 MW 180 MW Gasturbines MW Steamturbine Integrated steam cycle with companies: AZN + Shell (100 MW) situatie2005

9 Integrated energy concept AZN AVI stoom aardgas middendrukstoom Centrale Moerdijk Shell NL Chemie huisvuil lagedrukstoom voeding condensaat Landelijk elektriciteitsnet Evides Dow Terneuzen

10 Dow Chemical (Terneuzen-NL) next content Evides BO(O)T technical review Deminplant Evides sh# 19 Integration of waste & process (critical relationships - reuse) Raw treatment Water distribution to process users Waste Collection Waste Treatment Feed 22 Chemical plants End-Users Bleed to Discharge Reuse at different levels Effluent recycle Treatment

treatment Water distribution to process users Waste Collection Waste Treatment Feed 22

11 E4Water project Continuous development & progress in chain TODAY TOMORROW E4Water project Continuous development & progress in chain

12 PPP Delfluent (The Hague) PPP Delfluent WWTP Harnaschpolder & Houtrust

13 PPP Delfluent wwtp Harnaschpolder/ Houtrust PPP Delfluent Delft Blue Water project pilots in progress to develop future of chain Start point: 2008 Capacity: 50 m 3 /h Research Timeline: 5 years Research pilots: 3 lines with different treatment units

of chain Start point: 2008 Capacity: 50 m 3 /h Research

14 Evides DWP Rotterdam Demin Water Plant Botlek (Rotterdam) Multi-client plant & redundant distribution system X X Multi-client demi- production 1,400 m3/hr 15 clients in Rotterdam port area Full redundancy in piping infrastructure (length: 25 km)

Multi-client demi- production 1,400 m3/hr 15 clients in

15 DWP Design Overview of the plant DWP Located at the site of Huntsman Holland BV, Port of Rotterdam - The Netherlands DWP Design PFD of the plant DWP

16 electr electr Huntsman Co-Siting - Rotterdam Botlek-site steam steam demi steam electr electr steam CO Huntsman Co-Siting - Rotterdam Botlek-site Lyondell Basell Steam steam electr steam steam demi steam electr CO Electr.grid Electricity Gasunie Gas Evides Drinking Evides Process CO H2 Air Products Propylene oxide Lyondell Basell Formalde hyde Momentive Caustic Hydrochloric Chlorine acid Akzo Nobel Aniline MDI Vopak Nitrogen Linde Rotterdam area

grid Electricity Gasunie Gas Evides Drinking Evides Process CO H2 Air Products Propylene oxide Lyondell Basell

17 DWP Design Overview of the plant DWP DWP plant Mixed Bed Polishing

18 Rotterdam develops its position as national en international management and climate change proof city Rotterdam tries to foster new development in area of delta technology and new city design and city management Rotterdam likes to be the inspiring example for main ports and delta cities across the world Rotterdam TARGET: A reduction of 50 % CO2 emission in 2025 compared to the level in 1990 (for the City as well as for the Port). NWC: Nationaal Water Centrum June 26th the Nationaal WaterCentrum was launched by its founding fathers: Arcadis, DHV, Dura Vermeer, Evides, Ahoy, Hogeschool Rotterdam, TU Delft & the City of Rotterdam First Water Icon Floating pavilions

2025 compared to the level in 1990 (for the City as well as for the Port). http://www.rotterdamclimateinitiative.

19 Stowa Report Op weg naar de RWZI 2030 Trends treatment technology N: Nutrients and materials recovery (Phosphate; metals; etc) E: Energy reduction/ recovery (Energy factory; Sludge digestion; N conversion without O2 (anammox); etc) W: Water reuse (tertiary polishing; IMS systems; etc) Synergic, integrated (both big scale and small scale applications) & decentralized Stadshavens Demo site Example of New concept (Brainstorm TUD with Evides 2010) Companies Water to urban & industrial purpose Urban waste Separation ceramic nano filter MAP Recovery phosphorus & nitrogen Anammox Reduction residual N ActiveCarbon UV parties Anaerobic unit fertilizer Airo Desal Eutectic Freeze Crystallization residue Heat to urban buildings electric energy demin salts Industrial purpose

Demo site Example of New concept (Brainstorm TUD with Evides 2010) Companies Water to urban & industrial purpose Urban waste Separation ceramic nano filter MAP Recovery phosphorus & nitrogen

20 Conclusions Conclusions The Netherlands DBFO is already over 100 years old in the NL Industrial DBFO and PPP are successfully operated in NL Effective operations (financial incentives): Delfluent savings > 15% Focus on Core business justifies: Utilities are non-core (power & ) Economies of Scale: DBFO requires financial scope > 10M Risk sharing: cositing (Huntsman & BASF Verbundsite) & IP revitalization (Moerdijk & Delfzijl) ROI - Money is not the only driver: customer intimacy (focus on customer relationship) Innovation: Water cycle integration and Rotterdam climate initiative Innovation: E4Water & Delft Blue Water (incentives in DBFO contract)

scope > 10M Risk sharing: cositing (Huntsman & BASF Verbundsite) & IP revitalization (Moerdijk & Delfzijl) ROI - Money is not the only driver: customer intimacy

21 Key success factor in DBFO Customer relation Win-Win Introduce situation Professional transparency DBFO contract Trust Collaboration Thanks for your attention. Info:

www.evides.nl IIR symposium Oplossingen voor Watermanagement in de industrie 2009 14:15 - Evides : DBFO Contracts

www.evides.nl IIR symposium Oplossingen voor Watermanagement in de industrie 2009 14:15 - Evides : DBFO Contracts IIR symposium Oplossingen voor Watermanagement in de industrie 2009 14:15 - Evides : DBFO Contracts Content DBFO Contracts: Introduction Outsourcing Examples Drinking Water and Industrial Water supply