www.energydigital.com | June 2015
Microgrids Yesterday, Today And Tomorrow TOP 10 Trends To Watch
HORIZON POWER Looks To The Future
Special Report:
LAKE TURKANA WIND POWER
DIRECTOR’S COMMENT
Microgrid Goes Hot A LT H O U G H T H E F I R S T M I C R O G R I D
was technically introduced to the world by Thomas Edison in the late 1800s, it was not until recently that the concept became a “hot topic” as an almost undeniable market necessity. Our renewables feature this month explores just that: the role of microgrids within the energy industry yesterday, today and tomorrow. Also this month, we reveal the top 10 industry trends – a must-read for any energy enthusiast! – and provide an in-depth look at the 15th annual African Utility Week. Recently held in Cape Town, South Africa, the event drew over 6,000 attendees throughout the water and utilities sectors. If you were unable to attend this year, you read our piece on page 6 to see why you should be there in 2016! Lastly, don’t miss our exclusive interview with Frank Tudor, managing director of Horizon Power, in which he discusses the evolution of energy within Western Australia.
Enjoy the issue!
Jennifer White Director of Content, WDM Group jennifer.white@wdmgroup.com
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CONTENTS
Features
Company Profiles
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UTILITIES
Lake Turkana Wind Power
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A FOCUS ON AFRICA’S FUTURE
R E N E WA B L E S
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THE FUTURE OF MICROGRIDS
TOP 10
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The Royal Commission for Jubail
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INDUSTRY TRENDS
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66 Swire Seabed
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Conduspar Condutores Eletricos
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Grupo Clealco
Horizon Power
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Coopesantos
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UTILITIES
A FOCUS ON AFRICA’S FUTURE
With eight break-out sessions offered to each participant, the event aimed to educate and offer insight to power and water utilities professionals 7
UTILITIES OVER THE COURSE of three exciting days, African Utility Week Clean offered industry-focused insight, education, innovation and celebration to more than 6,000 attendees. Globally recognized as the largest event of its kind, the event’s 15th year featured 250 exhibitors, 190 speakers, eight break-out sessions, technical workshops and the coveted 2015 industry awards. African Utility Week highlights the importance of energy production and the expansion of energy infrastructure throughout the continent. This year’s event, which took place in May 2015 in Cape Town, South Africa, was attended by a variety of industry experts and influencers including utility and IPPs professionals, municipality representatives, government regulation officials, developers, consultants, contractors, and academic / research institutions. Collectively, this group— and the event itself—aim to improve the state of energy throughout the country and around the globe. “This year we raised the bar in every aspect of African Utility Week,” said event director Evan Schiff in a statement released by the event coordinators. 8
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‘African Utility Week highlights the importance of energy production and the expansion of energy infrastructure throughout the continent’ “Adding an extra day, producing an exciting and relevant programme with thoughtful speakers, building our largest expo to date of more than 10 000 square meters and adding to this the various strategic local and international partnerships that enabled us to tell the world about the incredible opportunities available in the African power and water industry,” were all instrumental to the success of this event, Schiff explained. Primary Speakers CEO of Eskom Brian Molefe delivered the keynote address on Tuesday, May 12th, titled “Africa is open for business; investing in the hottest frontier,” before attending the Utility CEO Forum with corporate counterparts
A F O C U S O N A F R I C A’ S F U T U R E
More than 100 industry experts spoke at the 2015 event from countries such as Nigeria, Kenya, Uganda, Namibia, Ghana, Malawi, Zambia and Zimbabwe. The purpose of this C-level gathering? To discuss global and local issues such as cross-border collaboration. Each participant was invited to attend eight break-out sessions, and speakers included notables such as Hamanth Kasan, vice-president of the African Water Association in South Africa, and Nicholas Smart-Yeboah, director of customer service at the Electricity Company of Ghana. Martin Ganda, investor, advisor and strategist in Zimbabwe, spoke on how companies, organizations and individuals can structure investments
to improve customer-business relationships and maintain a global perspective of the energy industry. Mamadou Biteye, managing director of Africa’s Rockefeller Foundation in Kenya, spoke on how the energy industry can improve the well-being of Africans while Victor Kgmoeswana, news anchor and business advisor in South Africa, reviewed the country’s impact on global businesses from the use of news headlines. Andrew Herscowitz, coordinator for Power Africa and Trade Africa at the U.S. Government in Kenya, described how African investments in renewable forms of energy will be an investment for future citizens of the continent. 9
UTILITIES Each year, the Conference Advisory Board selects winners among the delegates to receive accommodations and acclaim for their contributions to preserving the future of Africa’s energy needs. The primary awards given at the 2015 conference as well the recipients are as follows:
2015 AWARDS • Lifetime Achievement Award – Lawrence Musaba, coordination centre manager, Southern African Power Pool in Zimbabwe • African Utility Executive of the Year – Sicelo Goodwill Xulu, managing director of City Power and president of the Association of Municipal Electricty Utilities of Southern Africa • African Power Utility of the Year – KenGen of Kenya • African Water Utility of the Year – National Water and Sewerage Corporation of Uganda • Municipality of the Year – eTekwini Municipality of South Africa
• Energy/Water Efficiency Project of the Year – Project SWATT, created by Ackermans & UGU Engineering Solutions of South Africa • Clean Energy Project of the Year – 280MW Olkaria Geothermal Power Expansion Project of KenGen in Kenya • Outstanding Woman in Power/Water – Florence Nsubuga, executive director of UMEME in Uganda • African Community Project of the Year – Bokpoort CSP Project of ACWA Power in South Africa • Collaboration of the Year – Kariba Dam Rehabilitation Project by the Zambezi River Authority in Zambia
African Utility Week 2015 drew more than 5,000 attendees within the energy industry
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A F O C U S O N A F R I C A’ S F U T U R E
‘Ensuring the continued success and global impact of this significant event, the Department of Energy has committed to a three-year partnership with the conference’ Workshops LARGE SCALE PV SOLAR Delegates were offered a guided tour of the SMA Sub-Sahara Production Ltd. manufacturing centre in Cape Town followed by a visit to Black River Park, one of the area’s largest commercial office spaces—and boasting an impressive 1.2MV of solar energy output via the roof. ISHACK PROJECT AT THE STELLENBOSCH WINE FARM The iShack Project provides electricity to residents of the area with the assistance of solar energy panels. Users of electricity only need to pay a nominal fee for use of the power source. Currently, 700 families partake in this project, but that number will likely double by the end of this year. SOUTH AFRICAN RENEWABLE ENERGY TECHNOLOGY CENTRE This centre is the first facility in South Africa to offer training within the renewable energy industry, from
roles such as Wind Turbine Service Technician to Solar PV Technician. Delegates were able to tour the centre so as to gain an understanding of its operational capabilities from an infrastructural standpoint. Corporate and Media Partners Sponsors for the event included notable companies such as DNV GL, Accenture, Shell, Eskom and Landis + Gyr, and media partners included African Business Review, Modern Power Systems and African Energy, among others. President of the United States Barack Obama’s Power Africa initiative was the country partner. Ensuring the continued success and global impact of this significant event, the Department of Energy has committed to a three-year partnership with the conference, and preparation for next year’s event is already underway: the 2016 African Utility Week will be held May 17-19th in Cape Town. Visit www.african-utility-week.com for more information. 11
R E N E WA B L E S
The future of MICROGRIDS Although widely used today, industry experts predict the growing demand for energy will result in an exponentially increased use of microgrids
THE INTERNATIONAL ENERGY Agency (IEA) has projected that by the year 2020, developing countries will require approximately double the amount of present electrical output. The demand for energy in these regions is expected to outpace growth of conventional macrogrids in the industrialized world and result in an undeniable need for microgrids. To further support this theory, the IEA also predicts that by 2035, approximately 80 percent of the world’s energy growth will be represented by developing nations. But the recognizable need for micogrids has been a long-time coming; in fact, some industry experts consider the Manhattan Pearl Street Station, the power plant constructed by Thomas Edison in 1882, to have been one of the first microgrids in use. Aware of the benefits, Edison and team added another 57 DCs before the end of the 1880s. The evolution of the microgrid market was put on hold, however, by the eventual adoption of state-regulated electricity services.
Solar and wind power
The role of microgrids today Microgrids are widely used in the existing electrical landscape, with 13
R E N E WA B L E S three primary markets serving as proof of the great opportunity for growth within the marketplace overall.
3. SINGLE BUILDINGS. Microgrids are also used as a means of support for conventional macrogrids in both commercial and residential buildings, such as hospitals universities. As a reliable source of power, microgrid usage in this capacity almost guarantees electricity will continue to be sourced to important these facilities, even acting as a complete backup source of power in times of crises.
1. COMMUNITIES. Rural communities within developing countries are often without electricity. Not only will these areas benefit by connecting to a complete power source, the continued advancement of each community serves to further assist with the country’s development overall. Present advancements in technology are estimated to allow for complete power to be supplied to 100 households at a time, a number that is expected to increase exponentially as technology continues to improve.
Challenges facing development Despite the proven value of microgrid usage, there are numerous challenges facing future development and even limiting the capabilities of those currently in existence. Some of the most notable include:
2. TELECOMS TOWERS. By using renewable energy sources including solar and wind power, microgrids are able to be selfsufficient and easily supply power to surrounding broadcasting towers, including those in remote locations. Microgrid usage also allows for telecom services to be extended and reach further into rural areas from a central location.
• RELIANCE ON BATTERY DEVELOPMENT. One of the greatest challenges of renewable energy is energy storage itself. Microgrids, which are often powered by renewable energy sources, face this same challenge as they continue to develop and result in the need for the development of batteries capable of holding excess energy. While solutions have been proposed
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THE FUTURE OF MICROGRIDS
– and some are even in development today – none have taken hold as the obvious solution. The demand for advancement has caused a sort of a “development race,” as various companies aim to create the next generation of batteries.
Windmills, an alternative source for electric power generation
‘Microgrids are widely used in the existing electrical landscape, with three primary markets serving as proof of the great opportunity for growth within the marketplace overall’
• STATE LEVEL PLANNING. Massive adoption of microgrids will begin at the state or regional level. The relationship status between the government and present utility providers will be of great importance. Those in positions to plan the expansion of electrical services will need to be able to see the benefit of microgrids, in addition to determining how to plan, distribute, store and maintain these new energy systems in accordance with their regulation. • INTERCONNECTION. Microgrids work well when connected to macrogrids. However, macrogrid companies don’t typically want microgrids to be connected to the central grid for two main reasons: microgrids can cause instability on older grids, and microgrids cause the utility 15
R E N E WA B L E S
Group of windmills in Aragon, Spain companies to lose business. Because of this, macrogrid companies tend to create policies and influence regulations that make it difficult for microgrids to be connected, thus inhibiting overall adoption and acceptance. • COST AND FINANCING. Cost of renewable energy is higher than that of fossil fuel for a number of reasons, including transmission and storage. Although these specific costs have hindered the adoption of 16
June 2015
‘The increased ease of providing electricity as well as the much-needed support given to macrogrids implies a bright future for microgrids within the energy industry’
THE FUTURE OF MICROGRIDS
microgrids and renewable energy overall, technological advancements are helping costs to decrease. The future of microgrids Microgrids will be used in a variety of settings as the landscape of electrical power continues to evolve. DIVERSITY Hybrid microgrids are able to generate and store electricity through a variety of different methods, including wind, solar and gas generators. This advantageous diversity means hybrid microgrids are a trend to watch and will likely be the go-to method for future builds—at least until the price of renewable energy drops, much like what’s been observed in the automobile industry and hybrid vehicles. SOCIAL INFLUENCE Advancements in communitybased solar projects, crowdfunding campaigns for new technologies and increased blackouts with macrogrids are supporting the social desire for microgrids. Society at large is also accepting of resource scarcity and the impact traditional
structures have had on the climate. Another element of microgrids that is appealing to many is the decentralization of power: Microgrids backed by renewal sources of energy are disrupting the monopoly of electricity held by major corporations. INCREASED CORPORATE ACCEPTANCE Another result of social influence is the (sometimes reluctant) acceptance of microgrids by some utility companies. However, as the benefits continue to surface, many companies are updating their business models to include microgrid options. These options range from allowing connectivity with central grids to actual development. The increased ease of providing electricity as well as the muchneeded support given to macrogrids implies a bright future for microgrids within the energy industry. As technologies overcome the present challenges and restrictions, microgrids will become increasingly prevalent in telecoms usage in addition to supporting developing countries and individual buildings that require consistent power.
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TOP 10
Industry
TRENDS
Increasing potential of cyber threats, heightened consumer demand and the emerging economies of developing countries are just a few of the key forces that are driving today’s global energy game. Following are 10 current trends of 2015 that affect the energy industry as a whole.
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Oil is Entering a New Growth Phase According to industry leader Arthur Hanna, the oil and gas industry is poised to enter a new growth phase. Hanna believes that despite dwindling demand for petroleum and gas products among First World consumers, the development that is currently being experienced by other nations will create a continued high demand for traditional energy, filling in the gap left by those transitioning to other power sources.
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INDUSTRY TRENDS
Solar Energy Will Continue to Grow According to the Solar Energy Industries Association’s (SEIA) U.S. Solar Marketing Insight 2014 Year in Review report, solar power usage was second only to natural gas in new generating capacity last year. This upward power in solar energy use is expected to continue, with some energy analysts predicting that solar power will meet 100 percent of the energy needs of U.S. consumers within 20 years. The International Energy Agency predicts that solar power production will increase to 662 gigawatts by the year 2035 and that investment capital of $1.3 trillion will be necessary to fuel this increase. Opportunities in solar energy are significant at this time and will continue to rise. Major increases in lithium battery production indicate that the predictions are likely to come to fruition.
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TOP 10
Cyber Attack Risk Will Continue to Rise Energy companies of all types are at risk for becoming the victim of cyber attacks, with the large, global corporations being targeted the most. Global corporations are becoming increasingly dependent on third-party vendors, creating a more open network that leaves them more vulnerable to hackers. As a
The Talent Pool in Oil and Gas is Shrinking
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The aging workforce will continue to result in a lack of qualified workers for key, specialized positions in the oil and gas industry. Industry leaders will need to make talent recruitment, training, and retention a top priority. According to the global consulting firm Mercer, talent gaps can potentially have a significant negative effect on the success of oil and gas companies. Substantial steps must be taken now to ensure the continued viability of these corporations 20
June 2015
result, solid security risk management plans are an essential component of minimizing financial loss. Even so, a study performed by ABI Research predicts that cyber attacks will cause energy corporations over $1.87 billion in revenue by the year 2018.
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INDUSTRY TRENDS
Increased Environmental Awareness in Consumers Perhaps one of the most significant trends in the energy industry today
The EPA’s Clean Power Plan
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Proposed in June of 2104, the U.S. Environmental Protection Agency’s (EPA) Clean Power Plan will require utility companies to take substantial measures to reduce carbon pollution emitted by their power plants. The EPA has announced that the Clean Power Plan will be finalized by the middle of summer this year. In sort, the Clean Power Plan will require utility companies to set and meet rate-based goals that will eventually reduce the amount of fossil fuels used to in the creation of electricity. This will result in the increased usage and development of both solar and windgenerated energy sources.
is the changing face of the average consumer. Once the forte of the counterculture of the late 1960s and 70s, environmental awareness is now common among average citizens. Instead of just flipping a light switch or stepping on a gas pedal, they’re putting substantial thought into how these things are powered, and they’re teaching their children to do the same. The energy industry as a whole faces increased monitoring by consumer groups as well as state and local governments.
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TOP 10
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Green Investing As a natural offshoot of increased environmental awareness, today’s consumers are also making investing decisions based on supporting green technology. According to the Center for American Progress, sustainable energy investment options will continue to increase during coming years, particularly as new power plants that do not rely on fossil fuels are formed. Otherwise known as socially responsible investing, green investing will have a substantial impact on which energy companies remain or become successful. Wealth management companies that specialize in green investing are becoming popular in all parts of the world and will continue to grow 22
June 2015
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INDUSTRY TRENDS
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Hydrogen Power Hydrogen power has been on the horizon for decades and has actually been used by NASA since the 1970s. Power produced from hydrogen fuel cells creates an extremely miniscule amount of pollution, and it has the added bonus of being the most abundant element in the entire universe 23
TOP 10
Renewables Increasingly Occupy a World-Stage Spotlight Despite the anticipated increased demand among emerging nations for fossil fuels, renewable energy sources are having a worldwide impact. According to a recently released United Nations Environment Programme report, developing counties spent $131 billion last year in renewable energy. Perhaps more importantly, renewables have now entered the global marketplace at a price point that is competitive with that of fossil fuels, and this is the most significant trend of them all. Overall, a major shift away from fossil fuels is a substantial factor in the energy industry that will continue to accelerate in First World countries, but the needs of developing nations may help bridge the gap left by those who are moving on to other power sources. The oil and gas industry isn’t going to fall into a lethal decline anytime soon, but the market will significantly shift, and the industry will have to develop serious strategies concerning talent development and retention in order to remain viable in the global power game. Solar energy appears to be a star player in the energy strategies of the near to distant future, along with hydro, hydrogen, geothermal and wind power. 24
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INDUSTRY TRENDS
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A fair wind over Lake Turkana Lake Turkana Wind Power (LTWP), after nine long years of negotiation and preparation, is now an active project that will be delivering 300 megawatts of power to the Kenyan grid by the end of 2016 Written by: John O’Hanlon Produced by: Kiron Chavda
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LAKE TURKANA WIND POWER
T
he Lake Turkana Wind Power Project (LTWP) aims to provide 300MW of reliable, low cost wind power to the Kenya national grid, equivalent to approximately 20 percent of the current installed electricity generating capacity. The Project is of significant strategic benefit to Kenya, and at Ksh 70 billion (€600 million) will be the largest single private investment in Kenya’s history. A barren moonscape, pitted with volcanic craters, arid and inhospitable, and populated by warring tribespeople. That is one view of northern Kenya, and in a sense it is true: but a dualistic world view that only sees ‘challenges’ misses the point entirely. The counties of Turkana and Marsabit have extraordinary qualities. Among these is their wildlife, for example it was the prospect of catching six-foot Nile perch weighing nearly 390 stone that attracted entrepreneur Willem Dolleman to the shores of Lake Turkana in the late 1980s. His main problem was the relentless wind that would take control of his boat – no tent that he could obtain could withstand the force of those winds, and he often had to give in and sleep in his car.
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ENERGY
The potential of harnessing those forces for electricity generation was not lost on Dolleman and his friend Carlo van Wageningen, but at that time wind power was still an embryonic technology, and the low cost of oil put it out of contention. Wind power development required subsidies, and none would be forthcoming in Africa. It was not until 2005, when oil prices rose above £50 per barrel for the first time, that they, together with Chris Staubo decided it was time to take another look. The ‘founding fathers’ of LTWP called up Harry Wassenaar and Kasper Paardekooper of KP & P, a company with a history of developing and operating wind power projects, to bring some specialist expertise to the project. They were highly sceptical. Wassenaar, an old school friend of Dolleman, was however persuaded to come for a holiday. “He fell in love with the place as soon as he saw it,” says van Wageningen. “The wind itself convinced him!” With the help of Henk Hutting another veteran of wind power, if that is the right word in such a new industry, who confirmed the reliability of the wind flow in the area, LTWP was set up in Kenya under the ownership of KP & P BV, and the real work began. Early this year LTWP chairman Mugo Kibati accepted the Project Finance International
Key Personnel
Carlo van Wageningen Director Carlo was born in Rome (Italy) on 7th January 1957. He lived in North and West Africa with his parents from 1958 to 1969, in Nigeria, Libya, Ghana and Sierra Leone. He then went back to Rome to finish his higher education. From 1976 to 1988, Carlo worked for the Food and Agricultural Organization (FAO) of the United Nations and World Food Program. He was stationed in Rome (Italy), Niamey (Niger), Cotonou (Benin) and Harare (Zimbabwe) in various capacities. He ended his career in the United Nations as WFP Assistant Representative.
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LAKE TURKANA WIND POWER
What can a proven track record do for you? With 35 years of experience in building wind power plants, +67 GW (54,000 wind turbines) of installed wind power across 73 countries, 52 per cent more installed capacity than the closest competitor* and more than 26,000 wind turbines globally under 24/7 surveillance, our track record speaks for itself. Based on this vast experience and accumulated knowledge, we continuously support customers and policy makers throughout the world. As your trusted advisor, Vestas can help you make the most of your wind power potential.
* as of December 2013
+67 GW 35 years 73 countries +54,000 wind turbines 30
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LAKE TURKANA WIND POWER (PFI) African Renewable Deal Award 2014 in recognition of the way the project finance was put together up to final financial close in December 2014 – it was considered the best project finance structure achieved in the region over the last couple of decades. “The MoU between Willem Dolleman, Carlo van Wageningen and Chris Staubo was signed in 2005 so it took nine years for us to complete the development phase,” says van Wageningen. That was three years longer than the founding fathers had hoped for, but explicable considering the complexity of the project and the painstaking way in which project and political risks perceived by lenders had to be mitigated, No collateral other than its own potential
ENERGY
The Lake Turkana Wind Power Project is the largest single private investment in Kenya’s history LTWP water storage and accommodation
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LAKE TURKANA WIND POWER
Engineering Africa... Civicon Group is proud to be associated with the Lake Turkana Wind Power Project Over the last 40 years, Civicon Group Engineering has established itself as the regions leading Mechanical Engineering, Civil Engineering and Contracting firm in East and Central Africa. The company has a dynamic management team with over 30 engineers and technicians, a staff base of 2000, a large asset base of 5 fully equipped workshops across Eastern Africa and over 350 pieces of heavy equipment. The group also provides out-of gauge Logistics, Cranage and Erection services.
Select Projects
Mechanical Engineering: Greenfield Titanium mine in Kenya. The scope included: Structural, Mechanical, Plate work and Piping (SMPP). Civil Engineering: Road construction, maintenance of 113 KM, Yei Juba Road, South Sudan. Logistics: Transport of brewery vessels, Uganda. Cranage & Erection: Development of Heavy Fuel Oil Power Plants across East Africa. Mining: Turnkey projects to develop Greenfield Titanium Mine (Kenya) and Greenfield Gold Mines (DRC). Oil and Gas: Building of well pads and associated infrastructure for leading Oil & Gas E&P companies. Demand for Engineering continues to grow, driven by: • Development of Power generation and transmission facilities in the region. • Investment by regional governments to develop new roads and maintain Existing ones. • Private sector’s Investment in oil storage facilities across the region and Exploration for oil and gas. Development of mining in the DRC and Tanzania
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• MECHANICAL ENGINEERING • CIVIL ENGINEERING • SPECIALISED TRANSPORT • CRANEAGE & ERECTION
KENYA • TANZANIA • SOUTH SUDAN • RWANDA • DRC • MOZAMBIQUE J u n e 2•0UGANDA 15
LAKE TURKANA WIND POWER was offered so the wind farm had to secure sound backing. Of course it had the support of the government of Kenya from day one, but given that there was only one customer for its product, the government owned Kenya Power and Lighting Company (KPLC), political risk was a considerable factor. Initially the World Bank had offered to cover this but withdrew after a lengthy due diligence process. This meant that a different structure had to be put in place, and that was not so easy. “Where you have a single client, lenders normally request that the offtaker issue a letter of credit in favour of the lenders equivalent to six months’ forecast invoicing,” says van Wageningen. “At 300 MW the monthly bill to KPLC would be around €9 million, but €54 million is a lot more than they had ever had to find at one time and it would have been difficult for them to obtain that kind of security. We had to be inventive and come up with a different structure that would satisfy the lenders.” This was eventually achieved through a temporary levy on the tariffs, paid into an escrow account held by the government but in favour of the lenders. Negotiations were held right up to cabinet level, however this is a project of strategic national importance and all parties wanted it to go ahead. Nevertheless it was with some relief that the partial risk guarantee (PRG) was signed by Mr Kibati and the leaders of the Standard Bank, the National Treasury and the Kenya Electricity Transmission
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Road Construction by Civicon w w w. l t w p . c o . k e
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LAKE TURKANA WIND POWER
Ketraco is a key partner in the Lake Turkana project. Building a 428 kilometre transmission line to power the 300MW wind farm
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Company (Ketraco) in December last year. Ketraco is a key partner since it is tasked with building a 428 kilometre transmission line to evacuate the power output from the 300MW wind farm. This EPC contract is worth €142 million, and is being carried out by the Spanish company Isolux Corsán. The line will link Loiyangalani, close to the Lake, to the town of Suswa, on the outskirts of the capital, Nairobi. An additional benefit is that various geothermal plants that will be located along its route will be able to upload their output in the future. Though this contract is not directly overseen by LTWP it is classed as an ‘associated’ contract. “We have to make sure we complete the two projects in a harmonised manner, to be ready when we are ready to deliver power from our plant. They have been working since August 2014, and should complete by July 2016 ready for us to come on line with the first 90 MW in October,” says van Wageningen. The transmission line is one of seven EPC contracts, the remaining ones all directly owned by LTWP. Following financial close work started on all
ENERGY
fronts in January and the site became a hive of activity. Perhaps the most important is the construction, or rather the upgrade of a 210 kilometre stretch of road from the A2 highway at Laisamis. This is being surfaced to take the site traffic, and is currently proceeding to schedule. The same is true of the work on the site itself, where 150 housing units are being built for the staff as well as admin offices and a fully equipped maintenance workshop. “As the turbines will be at full production all of the time they will need servicing twice as often as similar units sited in Europe for example,” he explains. “The workshops are designed to accommodate full maintenance of the turbines including refurbishment of gearboxes if that is necessary.” The usual resource of sending the nacelles to a Vestas depot is just not available.
Video - Lake Turkana wind power project named African renewables deal of the year 2014 in London
““We have to make sure we complete the two projects in a harmonised manner, to be ready when we are ready to deliver power from our plant.” – Carlo van Wageningen, Director
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LAKE TURKANA WIND POWER
“As the turbines will be at full production all of the time they will need servicing twice as often as similar units sited in Europe” – Carlo van Wageningen
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kilometres of internal roads are being built to reach the turbines on the estate
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Groundworks have also started for the substation that will collect the power from the 365 turbines and feed it to Ketraco’s new transmission line, and the foundations of the turbines themselves. As a preliminary, soil survey drilling is being conducted at each microsite to make sure it can take the 43 metre masts supporting the Vestas V52-850 kW turbines. “We planned it so that when the turbines start coming into Mombasa they are loaded on trucks and driven straight to the site, avoiding double handling at a warehouse.” Delivery will be on a rolling programme, with around 30 turbines arriving each month. Additionally, 110 kilometres of internal roads are being built to reach the turbines on the 40,000 acres estate, held on a 99 year lease from the government. A word about the siting concept would be appropriate here. Henk Hutting quickly corrected his new colleagues, who had thought the wind a local thermal effect, once they called him in. He explained how two opposing, low level seasonal winds affecting East Africa, the Kaskazi and the Kuzi, run for six months from north east to south west and for six months in a south east to north west direction. Split in one case by the great mountains of Kilimanjaro and Kenya and in the other by the Ethiopian plateau, in each case a portion is directed northward up the Turkana corridor by the constant low pressure of the Sahara. Accelerated by the venturi effect of the hills to the north of Meru, the wind to
ENERGY
the south east of the lake averages 12 metres per second or around 27 miles per hour. For the wind turbine designers, the problem was if anything that the site had too much wind! Now that it is under construction the wind farm seems certain to be delivering low-cost electricity to the Kenyan national grid by the end of next year. At full production its contribution will be equivalent to nearly 20 percent of the currently installed generating capacity of Kenya. “We don’t claim that wind power can be considered baseload (always available), but in fact we achieve good enough load factor, based on eight years of wind measurement on site. And because the transmission line brings power to this region for the first time, it will transform the lives of the local people. What the effect of development will be upon local conflict, which is rife, remains to be seen, but the more
Vestas 850 kW turbines w w w. l t w p . c o . k e
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The African continent contains many of the fastest growing emerging markets in the world today. In order to fuel this growth, the public private partnership model is being exploited throughout Africa to build the infrastructure needed to meet growing commercial demand. The Lake Turkana Wind Power Project is emblematic of the large and complex infrastructure projects that are now being pursued in SubSaharan Africa. In fact, in Kenya, this project is just the tip of the iceberg. Increasing modernisation efforts in the public and private sectors are making the difference. Bankable projects are easier to achieve in the face of better governance practices, lower political
risk, trade liberalisation and improved legal enforcement and regulatory regimes. With the availability of political risk insurance products, the implicit cover provided for by development financial institutions and guarantees offered by local governments, political risk in Africa can be managed effectively. In the legal arena, agreements are negotiated with detailed provisions providing for changes in the law or taxation schemes and the overall scrutiny of documents is significantly higher. As a result, opportunities are able to be valued more realistically which enhances the availability of creative financing options. In addition, the risk appetite of large multinational companies has increased as
evidenced by the growing number that have set up operations in Sub-Saharan Africa recently. Increased competition in turn is providing a more even playing field for newcomers to enter the market. As the Lake Turkana Wind Power Project shows, creative African solutions to African problems are paving the way for transformative infrastructure development. The opportunities in Sub-Saharan Africa are well-known to many. Those who understand the commercial challenges will reap the rewards of the PPP projects that will change the face of business in Africa.
Amyn Mussa, Editor Amyn Mussa is a partner at Anjarwalla & Khanna and head of the firm’s Energy & Infrastructure Group. Amyn is also Co-Head of the Energy & Infrastructure Sector Group of ALN, an association of top-tier independent law firms across Africa.
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enterprising are already seeing this as a chance to establish trading businesses, commercial fishing, tanneries and other sources of employment and revenue. “As soon as the substation goes live we will be electrifying the largest towns in the area,” promises van Wageningen. The communities of Loiyangalani, Kargi, South Horr and Laisamis, will have access to light, refrigeration and other enabling technologies. Since the transmission line will carry high speed optic fibre as well, they will get better connectivity than many people in rural Europe, he points out. The money that will come in to this neglected part of Kenya will surely make a difference. Because this is green energy the United Nations registered LTWP under a mechanism that will allow the project to generate carbon credits which will generate some $4million to develop
“As soon as the substation goes live we will be electrifying the largest towns in the area” – Carlo van Wageningen
Progress on the village construction for staff lodgings
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LAKE TURKANA WIND POWER
500k The amount the Winds of Change Foundation is to be seeded with each year. 40
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communities around the wind farm. Additionally the company has set up a CSR programme, implemented by the Winds of Change Foundation (a wholly owned subsidiary of LTWP) that funds health programmes and water, sanitation and educational initiatives. Seeded with â‚Ź500,000 a year, the foundation will be raising further funds to support business development. “Following extensive consultation with the communities to identify their needs we have created a 20
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year development plan for the foundation.� The communities have been asked to participate and identify their needs.� The 20 year plan will be delivered in five year segments, he says. To have secured the largest ever private-sector financing in Kenya with no fewer than ten European and African development finance institutions providing debt and equity is a great achievement. The project will change the lives of millions of Kenyans, and boost the national economy.
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JUBAIL:
The making of a modern city How technological innovation, sustainable development, and robust infrastructure put Jubail on the map Written by: Abigail Phillips Produced by: Craig Daniels
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Jubail new city centre
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n 21 September 1975, The Royal Commission for Jubail and Yanbu (RCJY) was established as an autonomous organisation of the Saudi Arabian Government. From day one, its mission was made very clear: to plan, promote, develop and manage petrochemicals and energy intensive industrial cities through successful customer focus and partnerships with investors, employees,
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Key Personnel communities and other stakeholders. These industrial cities are Jubail, Yanbu and the newest project Ras Al-Khair. When it was founded, the Royal Commission outlined a set of objectives which have underpinned its focus to this day. In essence, those objectives sought to raise the profiles of Jubail and Yanbu and put them on the map as areas ripe for foreign investment;
Ahmed Al-Balawi General Manager of Technical Affairs
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A NEW PATH TO GROWTH
ASSYSTEM-RADICON, YOUR NEW ENGINEERING PARTNER IN THE KINGDOM Assystem is an international independent engineering company, with nearly 12,000 employees worldwide. With 50 years of expertise in the nuclear sector, Assystem is now expanding its presence in Saudi Arabia. With operations spanning across verticals such as transportation, infrastructure, construction, and nuclear, Assystem brings extensive skills, know-how and global technology to the region. Seeking insight into the local industry networks and develop the Saudi talent pool, the company joined hands with Radicon, a leading local engineering consultancy with more than 400 employees in Al Khobar and Riyadh.
ASSYSTEM STEPS UP ITS PRESENCE IN SAUDI ARABIA INTERVIEW WITH STÉPHANE AUBARBIER, Executive Vice-President of Assystem and CEO of the division Energy & Infrastructure
In January this year, Assystem, an international engineering company, completed its acquisition of 75% of the Saudi Arabian design company Radicon Gulf Consult. Stéphane Aubarbier, Assystem Vice-President explains why it was a “win-win” for all parties. “As the 4th independent nuclear engineering company worldwide, Assystem wanted to strengthen its footprint in the GCC region- which is currently developing strongly in the nuclear energy sector. The company’s business model relies on building long-term links with local clients, which only an acquisition enables. Radicon, a 400-strong Saudi engineering company, fulfilled this need; since they understood the local market and had a reputation for quality and excellence, they were the natural choice.”
© Photo Credits: Assystem
“Radicon was enthusiastic too as some of its main clients wanted them to join forces with a western engineering company to bring in complementary skills. Today, Assystem - Radicon together are winning contracts that neither could hope to win alone.” Assystem-Radicon brings a new engineering offer in the Kingdom of Saudi Arabia. “In the Gulf, there is still enormous potential for investments in energy, infrastructures and transports. Our strategy is to build a high-performance engineering company that is destined to last.” “Indeed, Radicon will strengthen
the group’s outreach in Saudi and more globally in the Arabian Gulf, enabling us to support our clients locally in this region. Moreover, the
strong technical expertise of Radicon in infrastructure’s design as well as its understanding of the local environment combined with Assystem’s international reputation and historical expertise in complex project management, namely in nuclear, will enable us to be a reliable and efficient partner to our Saudi clients.” Assystem’s model is to transfer its expertise to local delivery centers. “We aim to place a strong emphasis on recruiting local engineers and implement different training programs to transfer Assystem’s historical expertise
namely in the fields of nuclear but also in project management and systems integration to local experts.”
Assystem was first active in the Gulf in 2011 through its participation in the UAE nuclear programme and its technical assistance subsidiary, MPH Global Services. In September 2013, Assystem relocated its energy and infrastructure division’s global headquarters to Dubai. Today, Assystem has more than 1200 employees in the MEA region across its offices in the UAE, Qatar, Yemen and the Kingdom of Saudi Arabia... www.assystem.com www.radicongulf.com @Assystem
SUPPLIER PROFILE
RADICON Assystem-Radicon offers expertise in complex engineering projects across the infrastructure (building and transportation), energy (power, oil and gas), and nuclear sectors. Assystem-Radicon supports businesses, such as EPC, operators and public bodies, in managing their industrial investments, from design through to dismantling, including commissioning, operations and maintenance. We have 4 key offers: project management, engineering design, systems integration and engineering, procurement, construction management (EPCM). Assystem-Radicon has been working on major industrial city projects such as Jubail. So far, the company has been delivering 7 million hours of engineering design for transportation, building, power and telecommunications infrastructures. Assystem-Radicon was created out of the merger between the Saudi engineering company Radicon Gulf Consult and the international engineering group Assystem. Today Assystem-Radicon has over 400 employees between Al Khobar and Riyadh, and can manage projects all over the Kingdom. Assystem-Radicon provides clients with the proximity and flexibility that only a local company can provide, while benefiting from the expertise, quality standards, and networks of Assystem, which has nearly 12 000 employees throughout 20 countries and is recognized as the 4th nuclear engineering company worldwide.
T H E R O YA L C O M M I S S I O N F O R J U B A I L
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encourage private sector investment in the regions; and develop the cities from both a human and environmental perspective. A focus on Jubail Jubail Industrial City is a Saudi model that tells the story of planning combined with the will to achieve the comprehensive civic and industrial development seen today at all local, regional and international levels. There is no doubt that the advanced infrastructure of Jubail is the cornerstone which has allowed the various industrial, commercial and social sectors to establish themselves through integrated action. Jubail infrastructure has the capability to operate continuously without failure of power or supplies
Jubail industrial city
Artist’s Impression of Jubail City Centre
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An Inspired
Evolution For over 35 years, we have been working with our customers and partners in translating their vision and ambition into the delivery of successful projects and services. Inspired by their challenges and by working together to find the right balance between ambition and sustainability, each project and service delivered forms an integral part of not only their success – but ours as well.
966 13 843 3336 • info@almashariq.com
Our History dates back to 1978 when Al Mashariq was established to provide support services for the electrical distribution infrastructure of the Saudi Electricity Company (then DEPCO) in the Eastern Province of Saudi Arabia. Since its incorporation, and as a result of the growing needs of its customers, Al Mashariq has evolved into a multidisciplined organization serving a wide range of market segments. Presently, Al Mashariq is operating as a main contractor and technical services provider in the following key areas: • Power Generation, Transmission, Distribution and Control Automation • Water and Waste Water • Telecommunications and IT • Industrial and Commercial Civil Infrastructure Our Philosophy Is to differentiate ourselves by harnessing technology and leveraging our in-depth knowhow gained from over 35 years of operation to offer our valued clients creative, sustainable solutions and services.
We believe that customer satisfaction can only be achieved through a firm commitment to understanding the intended results of our customers’ requirements and working closely with all stakeholders involved in bringing those results to fruition. With a focus and drive in providing engineered, value added solutions, we at Al Mashariq are committed to ensuring our solutions and services meet our customers’ requirements and contribute to their success Our Vision Is to be a preferred EPC Contractor and services provider in the fields of electrical generation, transmission and distribution, water, telecom / IT and construction infrastructure while contributing to the technical, economic and social development of the region. Our Mission Is to provide innovative, cost effective, sustainable solutions and services that meet both immediate and future needs of our clients through the principles of value added engineering, integration of skills and technology and continuous improvement.
www.almashariq.com
SUPPLIER PROFILE
AL MASHARIQ Al Mashariq Company is a multifunctional group which provide engineering services in the Power, Telecom, IT, Petrochemicals, Water and Civil Construction sectors in the Kingdom of Saudi Arabia. It is our vision to become the market leader in engineering contracting in the above sectors in the Kingdom and other Gulf Countries, whilst ensuring the highest level of customer satisfaction and quality standards and to contribute to the technical, economic and social developments of the region. Al Mashariq Company has witnessed extra ordinary strides in its growth during the past 30 years and aspire to acquire new heights in volume of business and to broaden its business activities through diversification in related fields. Al Mashariq Company shall operate in existing and new business which profitably capitalise our Corporate image of reliability and integrity. It is also our vision to ensure high standards of leadership in productivity and total quality management so as to offer best services to our customers. We also stand for fostering a culture of participation and innovation for employee growth and contribution. We believe in the principle: “The excitement of attaining the unachievable is a huge motivator for growth�.
www.almashariq.com
T H E R O YA L C O M M I S S I O N F O R J U B A I L in any of the existing facilities while meeting community requirements within modern, high living standards where all the necessities of life and tourist and recreational facilities are available. However, there is still work to be done to upgrade and expand the infrastructure to allow the private sector to participate in the growth and development of the city. Additionally, Jubail has been able to attract the necessary Saudi operations and maintenance manpower, which has in turn, led to the establishment of a community from the various areas in Saudi Arabia. Jubail is indeed the result of Insights of the wise leadership of the Kingdom of Saudi Arabia.
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‘Jubail has been able to attract the necessary Saudi operations and maintenance manpower, which has in turn, led to the establishment of a community from the various areas in Saudi Arabia.’
Part of Al-Fanateer Beach in Jubail Industrial City
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Abdullah Ahmad Al-Doss
T 966 3882 9027 F 966 3882 5761 E info@aldossary.c
Construction division Line Of Business - Constuction
• Roads & Bridges • Civil Infrastructure • Special Projects Our Clients
• Water & Sewer Lines • Road Maintenance
sary Holding Co.
com.sa
Commercial division Line Of Business - Commercial • Pump Service Center • Spare Parts Division • Metalock Engineering • Metalock Cold Repair • Curb Factory • Asphalt & Crusher Plants • Repair & Maintenance of Heavy Equipments • Hydralic Division
Visit us online at www.aldossary.com.sa Our Brands
P.O. Box 973 • Al-Khobar 31952 • Kingdom of Saudi Arabia
SUPPLIER PROFILE
ABDULLAH AHMAD AL-DOSSARY HOLDING CO. Current contracts: EPC of Roads Linking to Ras Al Khair, Phase I, Client: Royal Commission in Jubail The work consist of the provision of the detailed Engineering design, Procurement and Construction of approximately 42 km of roads, two (2) interchanges, four (4) bridges and a pre-engineering buildings for Residential and Services Compound (accommodation, building, mosques, clinic, fire stations, sport center) with furniture and fixtures and equipment, underground utilities, drainage channels, parking, lift stations, instrumentations, electrical power distribution system, including associated site works and underground utilities. Jubail Industrial City and Ras Al-Khair, Kingdom of Saudi Arabia Value Saudi Riyals 522.19 M PC of Roads Linking to Ras Al Khair, Phase I, Client: Royal Commission in Jubail Procurement & Construction of roads, bridges, vehicular culverts, drainage system, telecommunication system, underground utilities, crossing structures, electrical power distribution system, street lighting and traffic system. Ras Al-Khair, Kingdom of Saudi Arabia Value Saudi Riyals 468.00 M
T H E R O YA L C O M M I S S I O N F O R J U B A I L The making of a modern city In the city, the main development focus is on energy projects and subsequent infrastructure management. In recent years there has been a huge emphasis on innovation from an energy standpoint that has led to greater efficiency and sustainability for the city now and in the future. In the next 12 months, there is no sign that the innovation trend is slowing. In fact Jubail continues with its year-on-year growth as reflected in the number of projects completed in engineering, awarded in procurement, and delivered to construction for execution. At the end of 2014, there were a total of 99 active contracts in various stages of construction with a combined value of $5.3 billion. Out of those 99 projects, 22 were contracts being
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“Jubail Industrial City is rapidly growing in all directions, based on the Master Plan Strategy, towards a complete sustainable city” – Ahmed Al-Balawi General Manager of Technical Affairs
Ras Al Khair industrial city
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Preciously Integrated RC BUILDING
KOBAR HOSPITAL
• BUILDINGS CONSTRUCTION “CLASSIFIED AS A” • MAINTENANCE AND DEVELOPMENT OF MECHANICAL AND ELECTRICAL WORKS • WATER WORKS AND SANITATION • INFRASTRUCTURE
OUR CURRENT PROJECTS
AZIZYA COMPOUND
CONSTRUCTION OF ADMINISTRATION BUILDINGS, RC JUBAIL (097-C32)
ROYAL COMMISSION
JUBAIL, KSA
SECONDARY INFRASTRUCTURE & CONSTRUCTION OF HOUSING- PHASE 10, JUBAIL ROYAL COMMISSION, 815-C17
ROYAL COMMISSION
JUBAIL, KSA
CONSTRUCTION OF THREE SUBSTATIONS IN MANIFAH
SAUDI ARAMCO/HYUNDAI
MANIFAH, KSA
CONSTRUCTION OF HOUSING FOR MILITARY ARMED FORCE IN EASTERN AREA
MINISTRY OF DEFENSE
DAMMAM, KSA
HOSPITAL HASSA & KHOBAR (WITH 5 BUILDING ADDITIONAL WORK)
MINISTRY OF HEALTH
HASSA/KHOBAR, KSA
SAKAKA PROJECT (CONSTRUCTION OF 521 VILLAS)
MINISTRY OF HOUSING
SAKAKA
RESIDENTIAL & INDUSTRIAL COMPLEX, HAWTAH, SAUDI ARAMCO
SAUDI ARAMCO
HAWTAH, KSA
contact us
OUR AFFILIATES
info.kcc@alkifah.com
T 00966 (0) 13 845 9502 F 00966 (0) 13 845 9501 Visit our Website
www.alkifah.com 58
May 2015
Alkifah Tower • Opposite Chamber of Commerce • PO BOX 7973 • Dammam • 31472
T H E R O YA L C O M M I S S I O N F O R J U B A I L undertaken in Ras Al Khair and 47 were contracts under preparation in both cities. “Jubail Industrial City is rapidly growing in all directions, based on the Master Plan Strategy, towards a complete sustainable city,” explained Eng. Ahmed Al-Balawi General Manager of Technical Affairs. “The industrial area will be expanded to accommodate an industrial and logistics hub. We are also working with the Saudi Railway Company (SAR) on the development of a rail network, which will support industries and the supply chain.” However development is not just underway from an industrial perspective, work has also commenced in three community districts that will be developed to accommodate 150,000 residents and that will provide 27,000 housing
SUPPLIER PROFILE
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Housing Units in Jubail Industrial City
ALKIFAH HOLDING COMPANY
AlKifah Holding Company created a name for itself by participating in many economic and investment sectors, the most important one of them is the building and construction sector which includes many companies, building material and building equipment “contracting”, real estate and precast. All these companies unite to give the best services in the building and construction field, and selling buildings. Through determination, dedication and hard work AlKifah Holding Company was established more than 30 years ago. Currently at its prime, AlKifah Holding Company board members Al Afaleq brothers reached ultimate prosperity aspiring to move further in their triumphant achievements
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Mohammed Al Barghash Al Mansouri & Sons Trading & Contracting Company
Build and Maintain
We specialise in • Pipeline Construction • Rehabilitation of Oil , Gas, Water and Sewage Water Pipelines
• Industrial Plant Maintenance Services • Instrumentation • Electro-Mechanical Rehabilitation • Tele-Communication • Electrical • Civil & Earth Moving
Head Office Address P.O Box 31996 • Al Khobar 31952 • Kingdom of Saudi Arabia T + 966 (13) 864 1522/ 869 3345/ 893 9333/ 894 0444 F + 966 (13) 899 9603 / 895 3198 E info@mbtc.com.sa
T H E R O YA L C O M M I S S I O N F O R J U B A I L units, including all associated amenities to address the population growth. This will represent a growth of 100 percent, in comparison with the current residential footprint. Alongside this, the Jubail University College mega project will provide better education opportunities for future generations and will enable the Royal Commission to achieve its goal of fostering a knowledge-based, educated and innovative society. It is hoped that the city centre development, which is under construction today, will attract major corporate offices, provide a variety of needs for city residents, and improve the image of the city, while contributing to the economy and long-term diversification
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Plans fo rthe new Jubail University college campus
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T H E R O YA L C O M M I S S I O N F O R J U B A I L
Jubail City Centre
But Jubail is not the only city in the spotlight as Eng. Al-Balawi explains: “In Ras Al Khair, we also achieved significant momentum after awarding three major development contracts, and are on the right path to meet the schedule that was presented to the Royal Commission leadership in 2010. The recently opened road between the two industrial cities, with its excellent quality, was a significant and important milestone that was appreciated by all stakeholders involved,” he said. “In our journey, we have kept safety and quality as our prime focus. This year we have achieved a record of 13.8 million safe man-hours. With a
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Space Top co. LTD
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Support from strategy through to implementation
Land Mobile Radio Communication • Marine Radio Communication Marine Navigation Equipment • Satelite Phone • Paging System Network Cellular Network Repeater • Radio Antennas and Accessories Other Telecom Products and Services • Security & Safety System Jubail office Dammam office
62
T 01336 25585 F 01336 18929 T 01383 26011 F 01383 46166
P.O Box 9010, Dammam 31413, Saudi Arabia M ay 2015
We make ICT strategies work
www.detecon.com info@detecon.com
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contractor workforce of around 20,000 spread over 200 sites and a large worker turnover.” Building a smarter city So what does it mean to be a truly sustainable city? Innovation, IT and data services certainly play a vital role, as Eng. Al Balawi explained: “We think the most innovative aspect of the industrial city is long term city planning which helps us meet future demand. From an IT perspective in particular, the civil infrastructure of duct banks with future provision has simplified the installation of a fibre optic network.” It goes without saying that in today’s highly connected world, a robust telecommunications network is going to be central to winning ‘smart city’ status. “Recently we have completed
“This year we have achieved a record of 13.8 million safe man-hours. With a contractor workforce of around 20,000 spread over 200 sites and a large worker turnover.” – Eng. Ahmed Al-Balawi, General Manager of Technical Affairs
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Aerial view of Jubail Industrial City
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the replacement of the telecommunication networks across the city and many residential and industrial areas have been equipped with fibre optic. However, a smart city is not just about installing fibre optic cables; it is a much wider concept, which involves providing comprehensive infrastructure and services to business and the community as a whole,� said Al-Balawi. Introducing the district cooling concept As well as bringing technological advances to within the city walls, the Royal Commission has also introduced a district cooling concept, which is currently in development. The aim of the new cooling system is to improve power consumption across the city, while also allowing high density and diverse usage to occur. For example, the new system will allow cold storage of energy to avoid energy outages during peak hours. Arising from this concept, the city hopes to attract new industries and foreign investors to the area. The Royal Commission has set a goal to raise the standard of the three cities in a wholesome and all inclusive way. Not content with papering over any cracks, every detail has been considered, no matter how large or small. Robust infrastructure, technological innovation, sustainable development and social considerations have set Jubail, Yanbu and Ras Al-Khair in good stead to flourish now and in the future.
Company Information INDUSTRY
ENERGY HEADQUARTERS
Jubail Industrial City, Saudi Arabia FOUNDED
1975 EMPLOYEES
+3000 REVENUE
Not disclosed PRODUCTS/ SERVICES
City planning and development
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SWIRE SEABED Thriving worldwide Written by: Sam Jermy Produced by: James Pepper
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SWIRE SEABED
Henry Cesar OM
The specialist subsea company, supported by a prestigious parent group, is beginning to build on its own stellar reputation by expanding its international oil and gas related projects. 68
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D
espite testing times in the industry, Swire Seabed is looking forward to a new era full of international opportunities. Founded in 2008, and purchased by Swire Pacific Offshore in 2012, Swire Seabed provides a highly flexible range of integrated inspection, maintenance and repair (IMR) and subsea construction services to the oil and gas industry. It also has a strong subsea engineering team that delivers decommissioning, survey and dredging projects. The company is a pioneer in deep water salvage operations and is one of the only companies globally which owns and operates a ROV at depths of up to 6,000 metres. Operations are coordinated from its headquarters in Bergen,
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Norway with an office in Baku, Azerbaijan set up mainly to support BP’s IMR and subsea requirements in the Caspian Sea. Arvid Pettersen, CEO of Swire Seabed, said: “The origins of the company lie in deep water salvage work, and today we have approximately 175 employees who maintain those pioneering skills but now focus primarily on the oil and gas industry. Cargo recovery is the icing on the cake for the business. People love that kind of work because it is out of the ordinary. Take the recovery of the engines from the NASA Apollo 11 space programme for instance: It was a fantastic experience for the crew and everyone involved enjoyed doing this exciting work with someone as dynamic as Jeff Bezos.
Key Personnel
Arvid Pettersen CEO of Swire Seabed
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SWIRE SEABED
Retrieving an ROV
«
“We have established an excellent reputation in a relatively short space of time. Much of our work is a result of previous successes and comes from word-of-mouth referrals from our clients. Last year, we won a contract with Shell, and the partnership has been ongoing since then. “Being a part of one of the largest companies in the offshore industry, Swire Pacific Offshore, is a huge benefit to Swire Seabed. Swire takes a long-term view of business, and this has allowed Swire Seabed to invest, develop and grow its own business. In times of industry recession, we are very fortunate to be in this position, and we stand in stark contrast to many in our industry”.
bergen@kluge.no www.kluge.no/en Stavanger » Oslo » Bergen
+ 0047 55 94 17 40 • jens@asmekanikk.no
Manufacturing and Repairs for the Shipping & Offshore Industry
Our team is
open,
commercial
»
and looks for
solutions
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AS Mekanikk • Gravdalsveien 245 • 5164 Laksevåg • Norway
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Group-wide network Being part of Swire Pacific Offshore provides Swire Seabed ready access to a global network of offices, vessels and expertise as well as a degree of financial certainty that is rare for smaller companies. With a fleet of three vessels, Seabed Prince, Seabed Worker and Seabed Supporter, Swire Seabed is able to tap into the expertise and assets of the wider Swire Pacific Offshore group when needed. The 43 offices and 88 vessels within the Swire Pacific Offshore fleet gives Swire Seabed unrivalled scope for a company its size. Pettersen agrees that capitalising on the wealth of expertise and experience of its parent company is one of the key drivers behind Swire Seabed’s rapid expansion phases, with targeted growth areas around the world and hotspots such as Asia Pacific, West Africa and South East Asia within easy reach. Pettersen said: “That’s where our focus is, to enhance the group’s capabilities and leverage
“Swire takes a long-term view of business, and this has allowed Swire Seabed to invest, develop and grow its own business. In times of industry recession, we are very fortunate to be in this position, and we stand in stark contrast to many in our industry.” - Arvid Pettersen, CEO of Swire Seabed
Seabed Worker
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SWIRE SEABED
Seabed Excavator
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on the local knowledge and expertise that has been built over the 40 years that Swire Pacific Offshore has been operating. Integration is a key focus for us as we need to tap into these invaluable resources in an effective way that will be beneficial for both the subsea and OSV sides of the business. Being part of a larger entity also provides great opportunities for our workforce.� “Currently, our centre of excellence for subsea services is in Bergen, Norway where we also train engineers and ROV pilots. For subsea operations, we are in the midst of developing our own internal
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training programme and will tie up with SPO’s flagship training centre, Swire Marine Training Centre in Singapore.” Vision Swire Seabed has been benefiting from its group-wide facets and is expanding into different regions. The management is confident that capitalising on the downturn by expanding its fleet, its product lines and geographical coverage is the right thing to do. Pettersen concluded: “Currently, our main operations have been in the North Atlantic, from Canada, to the US, the North Sea and Northern Norway. Moving forward, with a greater installed base of subsea assets in the southern Atlantic and in Asia, it is natural that Swire Seabed will leverage on Swire Pacific Offshore’s strong presence in these areas. Likewise, we will invest heavily in our equipment, and incorporate state-of-theart technology, to prepare for the increasingly complex jobs that the industry undertakes. Take for instance, the in-house designed Seabed Excavator, is capable of working at depths of 2,500 metres utilising a range of different tools from cutting tools to suction excavators. Being nimble and small ensures prompt and flexible responses to clients, yet having ready access to the expertise and resources of the large conglomerate it belongs to, means that Swire Seabed is an agile business that looks set for more exciting growth in the coming years.”
Company Information INDUSTRY
Energy HEADQUARTERS
Bergen, Norway FOUNDED
2008 EMPLOYEES
51-200 REVENUE
$90m PRODUCTS/ SERVICES
Oil & Energy
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Horizon Power:
Horizon Power looks to the future Managing Director Frank Tudor discusses new projects and now Horizon Power fits into the changing landscape of energy in rural and regional Western Australia Written by: Sasha Orman Produced by: Vince Kielty
HORIZON POWER
H
orizon Power is a vertically integrated, state-owned utility working in a unique space—the regional and remote areas of Western Australia, from the Kimberley, Gascoyne, and the Pilbara, to the Mid-West and southern Goldfields regions. “Its scope of operations is very large— we operate across 2.5 million square kilometres, about 1/3 of the landmass of the US,” said Frank Tudor, Managing Director. “But we only have 100,000 people that we supply spread across 40 independent systems, including the North West Interconnected System 76
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and various towns and communities.” Tudor has been with the utility in various roles since its inception in 2006 when Horizon Power was formed after the disaggregation of the state-owned Western Power. As Managing Director since 2010, he has brought his years of experience in energy, oil and gas, and foreign affairs to help navigate the business through new growth and new directions in a rapidly changing industry. Key projects of the present for the world of tomorrow “Our focus in the next five to
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10 years is to determine how we will play a role in the new distributed energy world alongside maintaining the grid. The network will become progressively more intelligent in hosting advanced meters—which we’re in the process of rolling out to our communities, including all manner of sensors/switches,” said Tudor. Horizon Power is engaged in a partnership with Electrix and Silver Springs Network on a major investment in advanced metering infrastructure. Using smart grid technology, the company plans to better monitor its network integrity
in real time and use advanced analytics to keep equipment in top working order. It’s just one of several investments that Horizon Power is making to increase its capabilities and provide the best service possible —from power stations in the Mid-West, to network projects supporting iron ore and liquefied natural gas (LNG) industries in the Pilbara region of Western Australia. “Out of the Pilbara, Australia is exporting more than 700 billion tonnes of iron ore. It’s also host to two producing LNG plants and two other LNG projects that will be commissioned shortly. It is a w w w. h o r i z o n p o w e r. c o m . a u /
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world class resource area for iron ore and natural gas, and a hugely important part of the Australian economy,” said Tudor. Horizon Power is involved in several projects in the Pilbara, including increasing the resilience of the energy grid, supporting the mining industry’s residential base, and the construction of a 100 megawatt temporary power station built in conjunction with GE’s alliance partner American Project Rentals (APR). “That power station was delivered on-budget without compromising security of supply,”
said Tudor. “The Pilbara power project is interesting because we built permanent infrastructure that will initially support APR’s transportable generators for a period of approximately two years. APR will then take those generators and deploy them elsewhere. We then plan on working with a company out of Canada called TransAlta to connect to the permanent 180 megawatt power station, again using GE machines. That will be the first combined-cycle gas-fired power station in the Pilbara.”
SUPPLIER PROFILE
ELECTRIX SECURES HORIZON POWER CONTRACT
Electrix is proud to support Horizon Power in the rollout of the Advanced Meter Program. Electrix has made a firm commitment to Western Australia and has a solid base of both people and equipment on the ground in the state to ensure it can deliver on its service promise to customers. Electrix offers owners of electricity distribution networks a wide range of experience in providing asset management, maintenance and construction services for overhead and underground assets. Electrix values innovations that add-value to clients, assisting them to effectively manage the safety and reliability of their networks while maintaining the balance between operational, maintenance and capital requirements. Electrix is recognised as a leading provider of network inspection services with customers relying on Electrix to inspect more than 300,000 poles and related assets per annum to ensure the safety, reliability and durability of their networks. For more information please contact: Australia: Ian McLeod Phone # +61 3 8698 2200 Address 3/153 Bertie Street, Port Melbourne Victoria 3207, Australia
Website: www.electrix.com.au
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100 YEARS
POWERING PROGRESS
TransAlta is powering industry in Australia. We’re the largest behind-the-fence provider of electricity in Western Australia with 575MW of generating capacity in operation or under construction. We supply our customers with safe, reliable energy and are looking for new opportunities to power progress.
www.transalta.com
HORIZON POWER Making plans for the industry’s future “We need to be as any energy company across the planet needs to be: thinking about the future of the industry,” said Tudor. With this in mind, Horizon Power is taking potential industry trends and drivers of change into serious consideration—particularly the role that renewable and photovoltaics (PV) will increasingly play both at a residential and utilities scale level. “The take-up of renewable and PV across the planet has been extraordinary,” said Tudor. “China has been focused on cleaning
SUPPLIER PROFILE
ENERGY
up its environment, and its PV production has certainly driven down costs—and it has made huge inroads into the makeup of energy production in Australia. In Perth we have some 340 megawatts of residential PV installed, so we are getting close to penetration levels of 20 per cent. In other parts of the country—for example parts of Brisbane and Adelaide—the penetration is approaching well over 30 per cent. I think across the world, we are leading the take-up of residential PV.” Of course this change leads to the inevitable question: what does this
TRANSALTA
TransAlta Energy Australia is an experienced electrical operator serving large industrial customers in Western Australia. The company is the largest behind-the-fence supplier of electricity in the state with 425 MW of generating capacity and 150 MW of additional capacity under construction. Doubling the size of its business in the past three years, TransAlta has invested close to a billion dollars in assets with stable long-term contracts. Since 2011, the company has acquired the 125 MW Solomon power station, built the 270 km Fortescue River Gas Pipeline with its partner DBP Development Group (DDG), and is currently constructing the new 150 MW South Hedland power station, which will be the most efficient combined-cycle power plant in the region. TransAlta continues to grow in Western Australia, building on two decades of providing safe, reliable power in the region.
Website: www.transalta.com
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mean for the industry? “In essence, the physical size of traditional utility businesses is probably shrinking,” said Tudor. “So one of the issues for utilities is how do you continue to maintain relevance and grow your business when aspects of your traditional model look like they are shrinking? That poses a lot of questions in terms of the competency you need, and how you actually position and restructure a 82
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business to be able to develop a new business arm while still managing your existing core business.” These issues are very much in play for Horizon Power, putting the company in the position of providing its core business to consumers whilst moving into a strong position to continue delivering in the future when the energy industry starts to look very different.
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“I think people liken it to the Kodak moment that has seen other industries besieged by destructive technology, for example when we went from film to digital or mainframes to PCs.” said Tudor. “In our industry the question is when do we reach the tipping point? We’re moving from distribution by centralized power stations towards an interactive network for customers, where
connected customers are producing their own electricity and becoming an integral part of the grid. Any evolution of that looks and feels like a very different system than the one that we operate today.” Setting new benchmarks for success For the last couple years Horizon Power has been in the midst of a transformation, inspired by the w w w. h o r i z o n p o w e r. c o m . a u /
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HORIZON POWER progress made by regional coops with similar business models in the United States. “We did a pretty extensive benchmarking exercise against the co-ops— making allowances for differences in jurisdictions, regulations, and various things that exist at a business level between the US and Australia—and we learned a lot of lessons that we could apply,” said Tudor. While Horizon Power set ambitious goals, it is already making significant progress in achieving them—among other things, the company is already 70 per cent of the way toward a target to reduce discretionary costs by half. “So when you ask what our priorities are right now, it’s to continue to deliver on the target we set ourselves,” said Tudor. “It’s all about reforming our core business, incorporating the lessons that we learned from the benchmarking, and driving those lessons through some 40 separate initiatives that we’ve allocated to our senior management staff across the business.” A partner in energy One crucial trait that serves to set 84
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Horizon Power apart as an energy provider is its understanding of and proximity to the communities it serves. “Our vision from inception is to be your local energy partner,” said Tudor. “We’ve got a physical presence in the regions that we service—we have people on the ground, interfacing and responsible for the management of assets and our customer base locally. When you think about the sort of regional communities that we service, this is a key attribute that is made more important as other businesses withdraw their services. It also happens to be the most efficient and effective way of managing our regional assets and customers. According to Tudor, having people on the ground in rural and regional areas helps customers gain a better perception of Horizon Power as a true part of the community, which is especially vital in a world where consumer relationships with energy are changing. “People can access us, and talk to us—our people meet in the towns, and that in itself reinforces our sense of community and obligation,” said Tudor. “We’ve got to make sure that
ENERGY
people are aware of what we’re doing and that we’ve got reliable power and affordable power. So we’re very much part of the communities, and I think that we’re well placed to work through the future with customers, as they become more active in the provision of their own electricity.” Looking ahead Where does Tudor see the energy industry in the future? “I see the industry in a state of flux—I don’t look at any jurisdiction anywhere on the planet to see that people have got it right, and I don’t think any company working in any of those jurisdictions has got a clear and certain way forward to success,” he said. “They’re all in their own different ways looking at distributed energy and assessing what they should do in that space. Some have gone to the extent of splitting their businesses in two, so that they can aggressively follow a distributed energy path without worrying about any decisions they make in that path having a negative impact on their existing business. Then you’ve got others extending and defending the traditional business models.” But that state of flux is not a bad thing. To the contrary, it means that the industry is in an exciting time for the more adventurous and adaptable. “Having said all of that it’s a really interesting place to be,” he adds. “I think that—if you take it as such—it’s full of opportunity.”
Company Information INDUSTRY
Energy HEADQUARTERS
Karratha, WA, Australia FOUNDED
2005 PRODUCTS/ SERVICES
Horizon Power is a state-owned commercial corporation providing energy resources to 100,000 residents and 10,000 businesses across regional and remote Western Australia.
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Conduspar:
CONDUCTING ENERGY AND LOADING QUALITY
With more than seven thousand products in its portfolio, th company focuses on growth through a solid investment pla Written by: Flรกvia Brancato | Produced by: Danilo Stefanelli
he an
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onduspar has a lot of stories to tell since its inception. Founded in 1986 in Curitiba, Paraná state, the company used to process around 13.2 tons of copper every month, in an area of approximately 14,000 square feet. Less than a decade later, the company expanded its Latin American operation and built a 474,000 square feet unit in São José dos Pinhais, also located in Paraná state. Due to the sector and production lines’ steady growth, in 2009 Conduspar invested again in that same unit. Over the past 25 years, the company became specialized in providing solutions for copper and aluminum electrical conductors of low and high voltage. Aimed at both international and domestic markets, Conduspar stands out in the sector and is proud of its ISO 9000 certification, which has been the result of excellence in products and services. With over seven thousand products in its portfolio, Conduspar serves government agencies as well as public corporations. Amongst them are building, power and
Facade
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ENERGY
Catenary machine, production of medium voltage cables is one of the most modern in Latin America
energy companies such as CEMIG, Petrobrás, COPEL, Furnas and Chesf. STRENGTH AND INVESTMENTS The relevance of the company in the market is accompanied by a strike of positive results. According to Conduspar’s Commercial Director, Fernando Almeida, management and focus on growth should be credited all this success. “We are very familiar with multinational management. Our attention is concentrated on investments so we can continue to expand.” As part of the expansion plan, which started in 2007 and was finished last year, over USD$33 million was invested in machines, equipment,
“We are very familiar with multinational management. Our attention is concentrated on investments so we can continue to expand” – Commercial Director of Conduspar, Fernando Almeida
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Drum Twister machine, responsible for applying shield and twist the wires in a s
personnel systems and buildings. “Upon the conclusion of all construction work and remodeling, Conduspar has become the most modern company of its sector. We estimate that we have invested around USD$43 million between 2009 and 2014,” summarizes the director. Through a joint venture with Indian company Sterlite, two new projects were added to Conduspar’s product line, following the sector’s trends and challenges. Naval and optic cables were added to an existing 34-product line of cables and electrical conductors. According to Almeida, “Our 90
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single process
company has invested significantly in manufacturing special cables aimed at serving quality to a more demanding and knowledgeable market�. PRODUCTION AND QUALITY Conduspar stands out for its logistic competitiveness. It has more than 60 subsidiaries spread throughout main national markets. In addition, it is strategically located near main highways, airports and Paranaguå port, which assures speedy and on-time delivery. w w w. c o n d u s p a r. c o m . b r
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Copper high voltage power cable with EPR 105 degrees coverage
750 V BWF Flexible cable
Multiflex multiple cable
Quality coils
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General view of the factory
With countless innovative solutions in conductors, Conduspar manufactures a wide variety of products serving distinct sectors such as civil construction, electricity service providers, industry, commercial facilities and residential buildings; in addition to segmented applications. Conduspar’s Standard Quality Control Department meets NBR ISO 9001:2008, of the Brazilian National Institute of Metrics, Quality and Technology. In order to serve the energy industry, Consduspar abides by all required lawful regulations. The company certifies its products through the Bureau Veritas Quality International (BVQI), tending to all major retail, industrial and state-owned market needs. Conduspar understands the project, development, production and service stages. w w w. c o n d u s p a r. c o m . b r
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Commercial Director of Condusp
“The company is qualified to serve, with excellence, the markets of low and high voltage, which means we can be present in all big construction sites around the country” – Commercial Director of Conduspar, Fernando Almeida 94
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Additionally, Conduspar is part of a selective group of companies that make up the NBR 1900 Project—a program created by Eletrobras group, aimed at improving the quality of acquired and utilized services which leads to cost reduction and adjustment of delivery time. RESPONSIBILITY As part of the Group Condusa, the company maintains the same standards when it comes to social responsibility. The group develops community improvement projects together with its collaborators. Amongst them is a program
ENERGY
Company Information INDUSTRY
Metallurgy – Electric wires and cables HEADQUARTERS
São José dos Pinhais, Paraná - Brazil EMPLOYEES
390 E S TA B L I S H E D
1986 PRODUCTS/ SERVICES
par, Fernando Almeida
developed with the Little Prince Hospital to fight childhood cancer in Brazil. In regards to human resources, Almeida states: “We have constant training programs, career plan, profit sharing, scholarships and productivity bonuses, to name a few.” “Conduspar’s plans are to continue improving our service to the market, whether domestic or for export. The company is qualified to serve, with excellence, the markets of low and high voltage, which means we can be present in all big construction sites around the country,” concluded the director.
Complete line of wires and cables to low and high voltage MANAGEMENT
CEO: Jorge Dib Abage CFO: André Rauen Abage Commercial Director: Fernando Almeida Industrial Director: Renato Figueiredo
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GRUPO CLEALCO:
PRODUCING CLEAN AND RENEWABLE ENERGY With a steady growth, company presents a 20 percent production capacity increase per year. Written by: Flรกvia Brancato Produced by: Danilo Stefanelli
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GRUPO CLEALCO
T VHP sugar
Clealco Clementina
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he initial kick off that started the company’s activities happened thanks to a federal program named Proålcool. Started in the 1970s, the program provided incentives to alcohol producers by supporting sugarcane plantation, aimed at introducing a new fuel alternative while reducing the dependency on foreign oil. Since then, Grupo Clealco has demonstrated steady average growth, increasing its annual production capacity by 20 percent. Through the production of sugarcane, sugar, ethanol and electricity, the company is one of the main powerhouses in the sugarcane-based energy market in Brazil and recognized worldwide as a benchmark for clean and renewable energy utilizing sugarcane.
ENERGY
With three industrial plants located in the Araçatuba— São Paulo state— region, Clealco usesan area of approximately 345,000 acres of contiguous land where nearly 80 percent are company or company-shareholder owned, yielding a strong competitive advantage in sugarcane production. PRODUCTION UNITS Its logistic advantage is one of Clealco’s differentials: “Our three units are located equidistant 31 miles from one another, forming an almost perfect equilateral triangle in the countryside of São Paulo state. This yields operational synergies, harvest flexibility and guarantees a low cost in general and administrative expenses,” explains the Superintendent Director of Clealco José Antônio Bassetto Júnior. In 1980, politicians, cattle breeders and farmers bet on the new renewable energy generation activity. On that occasion, an association was formed to acquire 12,000 acres of land to create a plantation and build a plant. 3 years later the Clementina unit milled its first crop of sugarcane. As a result of Clementina’s excellent performance as well as of the expansion of the sugarcane-based energy market in Brazil, in 2006, a second unit in the city of Queiroz began operations. Today, Clealco Queiroz crushes more than 5.5 tons of sugarcane per crop. Despite the recent financial crisis that affected
Management José Antônio Bassetto Júnior
Superintendent Director Fábio Luciano Cordeiro
Financial Director João Roberto Silva do Amaral
Industrial Director Cássio Manin Paggiaro
Agricultural Director Gabriel Mota Carvalho
Commercial Director
“We have reached our goal to form a regional cluster and from there we are willing to prospect partnerships for integrated solutions in logistics to carry the products out of the plants” – Superintendent Director of Clealco José Antônio Bassetto Júnior
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Clealco Penápolis
“We also prospect partners to explore all this potential with us, especially in the cogeneration of electricity” – Superintendent Director of Clealco José Antônio Bassetto Júnior 100
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the sugarcane-based energy sector, the company maintained its expansion and productivity plan. In 2013, Grupo Clealco acquired a productive rural industrial unit located in Penápolis, São Paulo. Clealco was the only company in the Mid-South region to invest in more than one unit for the 20142015 crop. With all this structure in place, production is going really well. “We believe in our potential to generate energy, based on the high milling capacity and the company-owned land area, which yields security in raw material supply,” recognizes the superintendent. And he adds, “This upcoming crop, we will produce
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Clealco Queiroz
approximately 881 tons of VHP sugar (Very High Polarization) 151,000 MWh of electricity and 320 thousand cubic meters of anhydrous and hydrated ethanol.” MANAGEMENT STRATEGIES Clealco has adopted the best corporate management practices at its four thousand subsidiaries spread in over 30 cities. An emphasis is placed on executive personnel training and an external audit system performed by one of the world’s largest audit companies. Júnior states that management maturity is the critical point for success and a marker of the positive development of the group. “Our strategy is directed towards cost leadership. Everyone in our team is supported to succeed in this mission. We also prospect partners to explore all this potential with us, especially in the co-generation of electricity and the w w w. c l e a l c o . c o m . b r
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Kenkiti Kimura Cultural and Educational Center
establishment of a strategic logistic location to move out our sugar and ethanol production,” he says. With the goal of speeding up the workforce skill development, more than USD $661,000 was invested in building a modern development center. The Kenkiti Kimura Cultural and Educational Center offers multilevel courses, from technical training in maintenance—a product of the partnership with the National Service for Industrial Training (SENAI) and the Paula Souza Center, linked to the state government—to long distance graduate programs in partnership with Luiz Queiroz College of Agriculture (ESALQ) and the University of São Paulo (USP), one of the best universities specialized in agriculture in Latin America. 102
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Sugar production
Analysis
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GRUPO CLEALCO ENVIRONMENTAL RESPONSIBILITY On a voluntary basis, group Clealco maintains relationships with local suppliers and communities, promoting environmental education and technical training. In addition, the company has a plant nursery responsible for producing seedlings which are planted in areas recovering from deforestation. An agreement signed by the São Paulo state government, through the Environment, Agriculture and Labor Department, Brazilian Sugarcane Industry Association (UNICA) and Brazilian Mid-South Sugarcane Farmers Organization intends to develop actions to stimulate the sustainability of the sugar, ethanol and bioenergy productive chain. Among these actions, Clealco deserves commendation for its voluntary commitment to eradicate sugarcane burn. Additionally, local partnerships have become part of the company’s portfolio. “We are partners with ‘Projeto Ceretas,’ an initiative that works
Sugarcane plantation
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Cares
towards preserving the fauna of the Araçatuba region. This project also has the support of local plants as well as of the Bioenergy Producers Union (UDOP), Environmental Military Police, São Paulo State University (UNESP)—veterinary program—the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA) and the State Environment Department,” explains Júnior. INVESTMENT PLAN The superintendent still highlights the importance of some stepping-stones in order to become a leader in industrial efficiency within the sugarcanebased energy sector. “We have reached our goal to form a regional cluster and from there we are willing to prospect partnerships for integrated solutions in logistics to carry the products out of the plants. In order to achieve the objective of becoming leaders in quality, we established a vigorous quality policy and we also direct investments to support this initiative,” he declares. w w w. c l e a l c o . c o m . b r
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Superintendent Director of Clealco
Over the past years, Clealco has been laser-focused on the plans to invest in sugarcane plantation. It also acquired a third production unit, Clealco Penápolis. It made additional investments in the existing Queiroz unit to produce anhydrous ethanol in one high pressure boiler. “We are studying alternatives and partnerships to conclude the expansion of our cogeneration and seize the potential that we have in all three units,” he finishes. Another company differentiating factors is that 100 percent of both harvest and plantation operations are self-sufficient, as the company owns harvests, tractors, trucks and sugarcane planters. Júnior highlights that there has also been an investment in the crops’ adaptation to withstand the mechanized operations and increase productivity. “It has been 8 years since Clealco built a modern logistic intelligence center, which integrates strategic decisions of all agricultural operations in one place. The equipment 106
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Company Information INDUSTRY
Sugarcane-based energy HEADQUARTERS
Clementina, São Paulo Brazil E S TA B L I S H E D
1981 EMPLOYEES
4 thousand
o, José Antônio Bassetto Júnior
ANNUAL REVENUE
USD$ 328 million
is endowed with a remote communication system capable of sending the location and all operational data of the equipment,” he stated. Over the past 3 years, USD $65 million were invested. Now the plan is to wait for results, always focused on the operations. “We understand that now is the time to focus on the operational excellence and reap the rewards of these investments. We profited around USD $328 million. The forecasted milling for 2015 is 11.7 tons and we already reached 13.2 crushed tons per year,” says Júnior with pride.
PRODUCTS/ SERVICES
Sugarcane, anhydrous and hydratedethanol, VHP Sugar and energy
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R E N E W A B L E
ENERGY powering everycorner of Costa Rica
Coopesantos performs the largest efforts to power up with electricity even the smallest communities in Costa Rica, bringing along cable TV and Internet. 108
J u n ieo 22001155
Written by: Mateo Rafael Tablado, Editor Adjunto Interview by: Rebecca Castrejon, Editora en Jefe Produced by: Jassen Pintado, Project Manager Interviewee: Elias Calderon, General Manager for Coopesantos R.L.
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COOPESANTOS R.L
C Staff is under constant training, as the cooperative foresees employees to take over vacant positions in upper management
Coopesantos supplies
OOPESANTOS was founded in January 1965, as a cooperative dedicated to the distribution of electricity in the area of Costa Rica, which includes the communities of Los Santos and Caraigres. The company started operations on April 25, 1969. From that moment on, it has been part of a solidarity model, distinguished by bringing cost-effective electric to all inhabitants, 24/7. Coopesantos increased production of electricity through wind generation plants, later on dabbled in providing cable TV and internet services so that partners and customers could access the newest technology. “Talking about renewable energy means discussing the important benefits we provide to the environment. It also means bringing energy to isolated populations,� said Elias Monge Calderon, General Manager of Coopesantos RL. Monge Calderon has also been an inspiration to its human resource, management of the company, not just the big boss; he is a friend who has been with the organization for more than 46 years.
electric power, cable TV and internet to their end users
The Highest Rates Possible of Renewable Energy Coopesantos’ augmented operations from electrical grid operators to become power suppliers started in early 2011, when the coop opened the Los Santos Windpower Park, which
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currently operates on 70 generators, producing 42,000 MWh a year. The coop also recurs to hydroelectric power from San Joaquin Park, and shares with the other coops the power delivered by the San Lorenzo and the Sigifredo Solis hydroelectric centrals. When the area has been stricken by droughts, fuel has been an option to cover the complete demand, but the common goal for Coopesantos, the other cooperatives as well as other government agencies involved in electricity is for Costa Rica’s power consumption to be supplied in its entirety from renewable resources. “There are two more power plants to become operational before late 2016, increasing the country’s total power sources become almost 100 percent from renewable resources,” Calderon shared.
Celebrating 50 years along with the President of Costa Rica, Luis Guillermo Solis
Key People
Elias Calderon General Manager Elias Calderon Monge became a member of Coopesantos during the early 1960s; he performed field duties of usage registry for power services. His will for improvement and the cooperative’s support took him to accounting school at Castro Carazo Commerce School and afterwards he earned a Bachelor’s in business management from Central America Autonomous University (UACA). Calderon took other courses and training programs in the United States and other countries within the continent. In five decades working for Coopesantos he has been in charge of billing, collection, accounting and assistant manager. He has been president for organizations such as Costa Rica Cooperative Support Institute, and the Rural Electrification Cooperatives’ Association (Conelectricas).
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C O M PA N Y N A M E
Committed to expand windpower generation potential during 2016
Close Engagement with Government Agencies
The market is expected to open soon to foreign investments
Coopesantos and the rest of Costa Rica’s power supplying cooperatives work very close with government agencies and also with the country’s president, the environmental/energy and the technology ministries, in order to follow thoroughly and with detail every matter derived from the energy and telecommunications services they provide. This kind of cooperation is also sought from deputies engaged in new laws and important energy projects for Costa Rica. “We’ve designed a regional development plan, obtaining funds for projects in charge
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SECTOR
Coopesantos genertes 33 percent of the total energy supplied to end users
of municipalities, cooperatives and other development consultants to benefit communities and increase the area’s productivity,” the executive said. Skill Upgrading and Continuing Education Availability The constant training policy established by Coopesantos has certainly been positive, resulting in a low turnaround rate and providing in-house developed staff when key positions are open. When management positions became available, the cooperative does not need to post job offers demanding personnel from outside the organization. This support policy for the coop members who wish to attend college also
“We are the means for government programs to reach and benefit end users” – Elias Calderon, General Manager, Coopesantos R.L.
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COOPESANTOS R.L derived in the creation of the company’s legal department, as a former executive assistant attended law school and opened this department after graduating. “Workers from other companies want to become part of the cooperative because of our individual development programs,” shared Calderon. Upcoming Challenge: Market Opening to Foreign Investments Supplying power for populations located in areas within difficult access
The biggest challenge that power-supplying companies in Costa Rica are facing is the possibility of the sector’s opening to foreign
ENERGY
investments. Domestic companies hope the government keeps control of the sector’s developments, so power supplying keeps being affordable after foreign companies begin operations in power generation. To avoid possible inconveniences from the market’s opening, Coopesantos is already working on expanding Los Santos Windpower Park by installing 10 new turbines, hoping this second stage is ready to operate during 2016. Also, the San Joaquin Hydroelectric Park project is being shared with Conelectrica. These plans and measures will help Coopesantos reach a 45 to 50 percent production of the power the company must supply to its users from the 33 percent they currently generate.
Company Information NAME
Coopesantos R.L INDUSTRY
Power supply and generation, cable TV and internet service providers. HEADQUARTERS
San Marcos de Tarrazu, San Jose, San Jose, Costa Rica FOUNDED
1965
“We are the means for government programs to reach and benefit end users,” the executive finalized.
“Costa Rica has performed outstanding efforts in environmental awareness, becoming a worthy example”
EMPLOYEES
200+ REVENUE
USD $100 million + WEBSITE
www.coopesantos.com
– Elias Calderon, General Manager, Coopesantos R.L.
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