Singapore to triple desalination capacity by 2013

(AFP) Google News 7 Mar 11;

SINGAPORE — Singapore will more than triple its desalinated water capacity in two years' time when the country's second and largest desalination plant starts operations, the government said Monday.

The Public Utilities Board (PUB), in a statement to announce that local firm Hyflux has won the award to build the plant, said the water treatment facility is expected to be operational in 2013.

Hyflux in a separate statement said the project, which also includes the building of a power plant, is worth Sg$890 million ($704 million) and construction is expected to start by the fourth quarter of 2011.

The PUB said the new plant will produce 70 million imperial gallons (mgd) or 318,500 cubic metres of water per day, more than tripling the city-state's current desalination capacity from 30mgd to 100 mgd.

It said the plant will "enhance the drought resilience of Singapore's water supply, and ensure reliability for Singapore's water users".

The new plant will use membrane technology and generate its own power on-site for the process of salt removal that makes seawater potable.

Singapore announced last June that it aims to up its desalination capacity by almost ten times and meet 30 percent of its population's water demand by 2060.

Desalinated water -- costlier to produce than reclaimed waste water -- now provides 10 percent of Singapore's needs, while local catchments and imported water from neighbouring Malaysia account for the rest.

Singapore, lacking in natural resources including water, used to depend heavily on Malaysia for water to supplement its limited reservoir network, but in recent years has developed desalination and water recycling to reduce its reliance on foreign sources.

Hyflux to build and run second desalination plant
Francis Chan Straits Times 8 Mar 11;

HOME-GROWN water treatment firm Hyflux has been chosen to build and run Singapore's second - and largest - desalination plant in Tuas.

When completed in 2013, it will add 318,500 cubic m of desalinated seawater a day to the national water supply, said water agency PUB yesterday.

This would more than triple its total water desalination capacity from the current 136,500 cubic m to 455,000 cubic m in just two years' time.

Hyflux is helmed by its founder Olivia Lum, one of Singapore's leading entrepreneurs. The project, which also includes a combined cycle gas turbine power plant to supply the electricity, will cost $890 million.

Under the deal with PUB, Hyflux will form Tuaspring, which will enter into a Water Purchase Agreement (WPA) with the agency by next month.

Tuaspring will use Hyflux's filtration membrane technology for desalination and sell the water to PUB at a first-year price of 45 cents a cubic m.

According to PUB, Hyflux - which beat eight other bidders from Singapore and overseas - had offered the most competitive tariff over the 25-year concession period of 2013 to 2038.

The firm also has experience, both at home and abroad, in design-build-own-operate desalination projects, such as the SingSpring Desalination Plant in Tuas, and the Tianjin Dagang Desalination Plant in China.

'Hyflux's proposal meets the stated performance requirements for the quantity and quality of the water to be supplied to PUB and gives the best value to Singapore's water users,' said PUB director for best sourcing Koh Boon Aik.

An analyst, who did not want to be named, said although Hyflux had the right expertise, 'it didn't hurt that it was also an award-winning Singapore-born and bred company'.

'It's win-win-win for PUB, Hyflux and its shareholders because water is a national issue and it's better when it is handled by a Singapore company. And for Hyflux, the deal would help make up, over the mid- to long-term, for what it lost out due to the political unrest that stalled its project in Libya.'

Tuaspring will be built on a 14ha site near the SingSpring plant in Tuas, which has a desalination capacity of only 136,000 cubic m a day.

Desalination separates salt and other minerals from water to make it drinkable. This is one of the four sources of water supply here; the others are local reservoirs, imports and Newater.

With the 1961 Water Agreement with Malaysia set to expire in August, desalinated water will play a larger role in Singapore's water supply.

The Tuaspring plant is part of a water master plan unveiled by the Government in June last year, when PUB said it would ramp up desalination capacity by almost 10 times to meet 30 per cent of water demand by 2060.

Construction is set to start by the fourth quarter of this year. All engineering, procurement, construction, operations and maintenance will be undertaken by Hyflux's wholly-owned units.

PUB selects Hyflux for second desalination plant
Jonathan Peeris Channel NewsAsia 7 Mar 11;

SINGAPORE: National water agency PUB has selected Hyflux as the preferred bidder for the second and largest desalination plant in Singapore.

The plant in Tuas will be Hyflux's largest project worth S$890 million.

As the preferred bidder, Hyflux will form a concession company to enter into a Water Purchase Agreement with PUB by April this year.

Once all agreements have been finalised and executed, and the concession company achieves financial close, the agreement will take full effect.

The plant is expected to commence operations in 2013 and will add another 70 million imperial gallons or 318,500 cubic metres of desalinated water per day to Singapore's water supply.

Demand for water in Singapore is expected to double from 1.7 million cubic metres per day currently to 3.4 million cubic metres in 2060.

And the company said Singapore can be self-reliant in its water supply.

Cho Wee Peng, Group Chief Financial Officer of Hyflux, said: "The technology that PUB has employed over the last few years from Newater plants to desalination plants has enabled Singapore if necessary to achieve full self-sufficiency.

"So membrane technology has brought water to very affordable levels as we can see, and we will see that in the next 50 years, that is a goal that is very achievable."

PUB said the open tender attracted nine bids from both local and international companies with good track records in the water business.

The desalination plant will be constructed under a Design, Build, Own and Operate model.

This outcome-based approach offers bidders flexibility to design and develop the most innovative and sustainable proposal that meets the specified performance standards.

Hyflux will use membrane technology in the proposed plant and generate its own power on-site for the desalting process.

Excess power will be sold to the power grid.

At a first-year price of 45 cents per cubic metre, Hyflux offers the most competitive tariff for the supply of desalinated water over a 25-year period from 2013 to 2038.

-CNA/ac

Hyflux clinches $890m PUB water project
Plant for seawater desalination, to be built from Q4, will be the biggest here
Jermaine Ng Business Times 8 Mar 11;

HYFLUX yesterday announced that it has been named the preferred bidder to design, build, own and operate a seawater desalination plant by PUB. The company will hold a concession for 25 years.

The project, which has a value of $890 million, will be funded through a combination of equity and project financing.

As the preferred bidder, Hyflux will form a concession company to enter into a water purchase agreement (WPA) with PUB by next month. Once all agreements have been finalised and executed, and the concession company achieves financial close, the WPA will take full effect.

Construction is slated to start by the fourth quarter of this year and the project is scheduled to commence operations by 2013, through to 2038. The engineering, procurement and construction, operations and maintenance of the project will be undertaken by Hyflux's wholly owned subsidiaries.

The plant, which will be located in Tuas, will be Singapore's second and largest seawater desalination facility. It will add as much as 318,500 cubic metres of desalinated water per day to Singapore's water supply, at a first-year price of 45 cents per cubic metre based on the warranted capacity.

The homegrown integrated water solutions company also announced that a combined cycle gas turbine power plant will be constructed in order to supply electricity to the desalination plant.

'The onsite generation of power will help us drive higher efficiency and cost effectiveness in operations and maintenance of the desalination plant,' said Olivia Lum, group CEO and president of Hyflux. Excess power will be sold to the power grid.

This project is expected to have a material impact on Hyflux for the fiscal year ending Dec 31, 2011.

This is not the company's first desalination plant in Singapore. In 2003, the SingSpring Desalination plant, developed by Hyflux, commenced operations with a designed capacity of 136,000 cubic metres a day.

Hyflux posted a record $569.73 million in revenue and $88.51 million net profit for FY10. Currently, it derives some 60 per cent of its revenue from the Middle East and North Africa (MENA) region. China accounts for 26 per cent, while Singapore and other countries make up the rest.

Hyflux aims to focus its attention more on Singapore, Indonesia and Australia. 'We are keen to invest in large-scale projects in these countries as the markets have large potential,' said Ms Lum. 'It will be especially interesting here as Singapore's 1961 water agreement with Malaysia will expire this year.'

She also reiterated that the company has had 'no investments in Libya yet'. She did not rule out any possibility of future investments there.

Trading of Hyflux shares was halted yesterday. The stock closed at $1.83 last Friday.