opportunities & realities in mexico´s water sector
TRANSCRIPT
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May 2010Vincent Lencioni
LGA Consulting
Opportunities &
Realities in Mexico'sWater Sector
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Outline of 4 Part Presentation
A. Current Situation in Water Sector Problems & current Infrastructure Public & Private
B. Opportunities in Water Sector
Public & Private Sector Needs, Budgets, Activities
Preferred Products, Targeted Segments, Goals
C. Opportunities in the Context of Sector Realities
Regional challenges that limit access to and theviability of many public and private sector projects.
D. LGA Assistance: How and why we can help.
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A. Current Situation - Outline
Brief Water Sector Overview
Brief Analysis of state of Mexicaneconomy in the context of water sector
10 Sector Problems & Challenges
Wastewater treatment Industrial & public
Treatment Plants Industrial & public
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A. Water Sector Overview
Sector Dynamic
Geographical Challenges North vs South
Coastal vs Interior
Decentralization
13 Water Basins States & Municipalities
Funding Realities
NIP & Water Plans
Govt Bid Dynamic Nafta weakness, problems
identifying & following bids Private vs. Public
Economic Climate Affect 2009: Worst since 32
Construction down 7% Industry fell 20%
Govt revenue & spending Water: Public > Private
2010: ModerateReactivation Public still strong, private
up 2nd half, solid macro.
2011: Recovery Year Construction & Industry up Water: Private & Public up
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A. Related Economic Info
GDP 2009:Down 8% 2010 & 2001: up 4% each
Infrastructure Spending: $47.8 B in 2010 =5% of GDP Both Historic figures
5% was target for healthy growth
Mexican Imports 2010: Up 10%; 1st Qtr: Up 12%
Exports up 10% as well
By Segment (1st Qtr, 2010) Consumer: 37% up (31) Intermed: 20% up (23) Capital: 11% down (22)
Mexico Demographics 120 million population 40% (1-19); 24% (25-34)
Sector Dynamic 2009 Agriculture*: Up 1.8% Water/Electricity* Up 1.2% Food & Beverage*, Paper*, Chemicals*: -1 to
2% Clothing/Textile: -10% Machinery/Equip: -20% 2-5% Growth in 2010
Construction 2009: Down 7% 2010: Up 2-4.6%
Slow 1st Half, 8% last Qtr
2011: Recovery Year
Public Revenue
Oil Price: $60 (2009) to 75 (2010) Source for 1/3 of govt spending Balance of Payments solid Fiscal/Financial Stability
Banks: Revenue up 20%, 4th Qtr 2010
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A. Crime & Violence: Impact onBusiness
Fighting the Drug Cartels: Past vs. Present Right fight, hard to win, negative image
Historic military and US cooperation
Guns vs Drugs; Supply vs. Demand
Business Travel Concerns for Foreigners
North/Pacific Coast vs. South/Central Victim Profile Dynamic: 7000 deaths in 2009
93% = Police, Military, Narcos
Kidnapping (locals only) vs. General Crime (anyone)
Federal Oversight Up, Local Police Concerns Persist
Only 6% of Mexican companies consider crime & violence to have
major impact on business activities Traditional international & domestic economic concerns
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A. 10 Water Sector Problems& Challenges
1. Geographical Challenges
2/3 of water in the south: 25% population, 15% GDP
1/3 of water in the north/center: 75% population, 85% GDP
No water transfer system, No water collection strategies
2. Overexploited aquifers: 30%
653 aquifers: over 100 severely overexploited, 68 close
3. From 18,000 m3 (1950) to 4,400 m3 (2010) per capita But Mexico is still 7th in world rankings: 1. Canada (90,767), 2. Brasil (45,039), 3.
Argentina (20,707), 6. US (6,902)
Area of need but society that does not perceive the need yet
4. Conagua says 40% national wastewater treated, probably less
12% Federal District, 18% Jalisco, 21% State of Mexico
Only 5 states treat over 2/3 of their municipal waste
Other sources: Industrial below 10%, municipal below 20%
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A. 10 Water Sector Problems& Challenges
5. Traditional Water Statistics: Urban good, Rural needs work Potable Water Coverage: 97% Urban, only 76% Rural
Sewer/Sanitary Coverage, 96% Urban,only 63% Rural
6. Law requires 100% meter coverage, reality: 65% or less 80% coverage in large (>250,000) cities, minimal to none in smaller areas
Even where coverage exists, water often does not flow because of (a) lack of water, (b) poordelivery systems, or lack of pressure
Water authorities tend to buy cheap meters that do not last & breakdown
7. 50-60% of water lost in delivery system, little recent improvement
8. Water Infrastructure Competitiveness in Latam Rated far below Brazil, Chile, Columbia, and Argentina
20% below Latin America average, even behind Peru
9. 64th in Infrastructure Index of Competitiveness
Well below Brazil as well as Chile (35) and Panama (46)
10. Known for having some of the slowest and most bureaucratic water projectdevelopment processes in Latin America heard/said in lots of quarters.
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Municipal Wastewater Treatment Plants 1992-2008
Year Treatment Plants Installed Capacity(l/s)
Treated Volume(l/s}
A. Municipal Wastewater Treatment Plants,Installed Capacity, Treated Volume (1992-2008)
4x more plants since NAFTA, 2x installed capacitysince 1997 and 2x treated volume since 1999.Calderon: Plants up, capacity & treatment not.
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A. Wastewater Plants andTreatment by River Basin
No. Hydrologic Region =Organismo de Cuenca
Number of Plants inOperation
Installed Capacity(m3/s)
Water Treated(m3/s)
Lerma = 25% of plants; Rio Bravo = 25% ofInstalled Capacity and Water Treated; using
75% of Installed Capacity, Need a lot more.
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A. Treatment by Basin Analysis
Municipal wastewater treated by 13River Basins (Total = 100%):
1.- Rio Bravo/Northern Border 26.5%2.- Lerma-Santiago-Pacfic 21.5%3.- Pacific North 8.0%4.- Valley of Mexico 7.4%5.- Penisula of Baja California 7.3%6.- Balsas 6.5%7.- Central Northern Basins 4.8%8.- Northeast 4.0%
9.- Center Gulf 3.7%10.- Southern Border 3.1%11.- Gulf North 2.7%12.- Pacific South 2.3%13.- Pennsula of Yucatan 2.0%
Conclusions Majority of Treatment in
North (#1,3,5,7,8) Over 50% of all treatment
Significant Treatment inCenter (#2,4,6)
About 1/3 of rest
Insignificant treatment in
south/gulf areas Less need for water, lessindustry and population
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A. Municipal Wastewater Treatmentby State (Only Table Showing Coverage %)
State Municipal Wastewater Plants Coverage (%)
Number ofPlants
Installed Capacity(l/s)
Treated Water (l/s)
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A. Municipal Wastewater Treatmentby State Analysis
Majority of Plants in dry,northern states
1. Durango (167, 10%)
2. Sinaloa (136)
3. Chihuahua (119)
Most important states:fewer plants
State of Mexico (105)
Jalisco (96) Nuevo Leon (61)
Installed Capacity1. Nuevo Leon (12%)
2. Chihuahua (8%)
3. State of Mexico
4. Baja California
5. Federal District
Treated Water1. Nuevo Leon (14%)
2. Chihuahua (7%)3. Baja California
4. State of Mexico
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A. States Treatment Woes
- Less than 25% of waste watertreatment coverage
1. Yucatan 2.1%
2. Campeche 3.8%
3. Hidalgo 7.5% (DF wastewater)
4. Zacatecas 12.1%5. Federal District 12.9%
6. Tabasco 18.3%
7. Morelos 18.9%
8. Queretaro 22.7%
9. Jalisco/Guadalajara 24.7%
10.State of Mexico 21.1%*
* 7th most plants but 3rd mostinstalled capacity & 4th mostvolume treated.
Only 6 states treat morethan 2/3 wastewaters
5 Top States: All in North:1. Nuevo Leon = 100%
1. AGS = 100%
3. Baja Cal = 93%
4. Chihuahua = 71%
5. Sinaloa = 68%
Aquaculture focus
6. QuintanaRoo/Cancun=67%
Eco-tourism focus
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Present situation and Projection of Water Treatment of Urban Wastewater
Cost of total Annual
Discharge of Present Discharge of Needs of accumulated operational
wastewater capacity wastewater treatment investment in cost in
at present of treatment in 2020 2020 2020 ( Ref 2) 2020 (Ref 2,3)
m3/s 231 54 304 250 2780 2130
Biochemical
Oxygen
Demandtons/year 1.8 0.42 2.36 1.94
Ref 1.- Includes plants that are not currently operating
Ref 2.- Millions of current US dollars
Ref 3.- Includes existing plants (operating & non-operating) and those under construction
A. Urban (Industrial & Municipal)Wastewater Discharge Realities (Present)
Only 23% of urban wastewater & 23% of BOD isbeing treated. 2002 treatment need: 4-6x. Cost:
$2.78 Billion in Investment & $2.13 annually.
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Present Situation and Projection of Industrial Wastewater
Cost of Annual
Wastewater Wastewater Treatment accumulated Operational
Discharge Treatment Discharge Needs investment Cost
At Present At Present In 2020 In 2020 In 2020 In 2020(millions of
dollars)
(millions of
dollars)
m3/s 64.5 5.3 76 70.7 $1,571 $1,060
Millions
of DOB
per
ton/year 1.6 0.12 1.88 1.76
A. Non-Urban Industrial WastewaterTreatment Realities (Present)
Only 8% of top 1387 non-urban companieswastewater is being treated. 2020 treatment
need: 13x: $1.5 B in investment, $1 M annually.
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Present Situation and Projection of National Waste Water
Cost of Annual
Wastewater Wastewater Deficit accumulated Operational
Discharge Present Discharge in treatment investment CostAt Present Capacity In 2020 In 2020 till 2020 in 2020
(millions of
dollars)
(millions of
dollars)
m3/s 295.5 59.3 380 326 $4,350 $3,190
A. All Urban & Industrial WastewaterTreatment, Installed Capacity, Treated
Volume (Present)
Only 20% of all Wastewater is treated today; Needs:$4.35 Billion in investment until 2020, $3.19
Billion in annual operating costs as of 2020.
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A. Industrial Treatment Plants:Type and Number
Total Industrial Plants: 2082 (100%)
Primary: 648 (32%) Adjusting PH levels & removing materials > .1mm
Secondary: 1185 (56%) Removing colloidal & dissolved organice materials
Tertiary: 66 (3%)
Removing dissolved materials including gases Other: 183 (9%)
Without above or other concrete objectives
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A. Industrial Wastewater TreatmentPlants & Water Treated by State
Less than 60% used capacity; #1 State of Mexico (319,15%); #3 Veracruz (161): 20% total installed capacity& 25% total water treated, 2.5x State of Mexico.
State Number of Plants in
Operation
InstalledCapacity
(m3/s)
WaterTreated(m3/s)
State Number of Plants in
Operation
InstalledCapacity
(m3/s)
WaterTreated(m3/s)
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B. Opportunities - Outline
Private and Public Sector Definition
Federal & Local Water Budgets
Goals: 2012 Water Plan, 2030 Water Agenda
NOM/Standard Development Competition Analysis
Domestic vs International Product Preferences
Industrial Discharge Regulation
Water Rate Comparison and Analysis
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B. Private Water Sector Targets
- Private water infrastructure- Hotels & Resorts, Restaurants, Golf Courses, Malls, Industrial
Parks, Residential, Hospitals
- Industry water pollution
- Commercial & Industrial Discharge & Treatment- Industry water reuse & savings- Water costs, Water reclamation, water capturing systems
- Manufacturing processes using purified water
- Segments- 2030 Target Industries: Sugar, F&B, Paper, Metals- Problem Segments: Textile, Pharma, Chemicals, Leather
- High Use Segments: Agriculture, Aquaculture
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B. Public Water Sector Targets
A. Aquifers and Water Supply Solutions- Limited Resources
- Pollution Water Treatment
B. Clean Water Delivery Systems
C. Potable & Wastewater Measurement Products
D. Sewer & Drainage Collection & DistributionSystems and Flood Prevention
E. Wastewater Treatment & Reuse Strategies
F. Segments: Agriculture, CFE, Pemex
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B. Federal & Local Water Budgets
Conagua (National Water Commission) Budget- Since 2006: 125% increase ($1.2 to 2.7 B) and over $100 Billion Pesos
($8-9 billion US) invested- 2010: 5% up despite economy & cuts in other infrastructure sectors
- Potable water & sewage projects = $1.45 B US, double 2008 budget- Agriculture: $577 Million US, 60% greater than 2009 budget
State & Local Water Budgets Responsible for 95% of all water bids; try to remain independent of
Conagua technical specification and oversite, some friction Dependence on Conagua funding: majority of projects
Smaller/Poorer States & Municipalities: 70-90% of funding Larger/Wealthier Entities: Some without assistance, others 40-70%
Fonadin Water Trust & Banobras Financing Options Fully Funded, unused, still available to federal & local entities Banobras and other development bank options still viable & active
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Increased Irrigation technology
River Basin auto administrationAll rivers % lakes withouttrash
All treated water
reused
Contamination
sources undercontrol
Efficient regionalorderAll industrial
water treated
Flood zones withouthabitations
Urban suburbsconnected to the
network
Disaster alert systems and
preventionAll rural areas with potablewater
River Basin
Equilibrium
UniversalWaterCoverage
Habitableareas freefrom floods
100%CleanRivers
All municipal water treated
B. 2030 Water AgendaPriorities
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B. Goals: 5 Year Water Plan (2012)& 2030 Water Agenda
5 Year Plan (2007-2012) Potable water coverage: 92%
Sanitary/sewer coverage: 88%
Wastewater treatment: 60%
8% increase in efficiency from80 local water utilities
From 64th in world in waterinfrastructure to betweenPanama (46) & Chile (35).
Improve Water Productivity in
the Agricultural Sector Better flood prevention actions
Results So Far: Decent effortbut well below expectations
2030 Water Agenda By 2016: all major urban
areas free from risk of flood
By 2015, All Irrigation
technified, all treated waterreused
2024: Complete ruralpotable water access
2025: All Industrial
wastewater treated 2030: All aquifers and
contamination in balance
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B. New NOM Regulations in 2010
Opportunities to influence technology & infrastructure specifications:
Minimum flow levels for river basins to ensure caudal preservation/recuperation Water consumption specifications for plumbing/bathroom devices; Specifications and test methods for potable water system, sewer, and domestic water intake
related to hermetic questions; Maximum allowed pollutant limits for brine water discharge of sea water desalination plants
into national waters and related environmental impacts; Modification of NOM-011-CONAGUA-2000, which establishes the specifications and methods
to determine the mid-annual availability of national waters; Discharge for urban wastewater that is not connected to a sewer system; Requirements to obtain the seal of Ecological Grade for laundry washing machines; Specifications for rainwater discharge in urban zones; and Flow control devices, water flow regulators, and test methods.
Process includes committee meetings to discuss appropriate approaches andtechnology. Domestic companies and foreign companies that can demonstrate theirfocus in the area are allowed to participate in the process, LGA can assist.
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B. Local & ForeignCompetition
- 70% of Products Used in Water Sector: Imported- US Provides 2/3 of imported products to water sector
- Israeli: Strong and growing presence- Treatment plants (Companies: Aqwise, Amiad, Odis,Yamit)
- Waste water treatment products (dewatering systems),
filtration products (plastic, steel and automatic filters).- Some in-roads with metering products (MasterMeter/Iroda)
- Spanish: Engineering firms/Integrators (OHL)
- Chinese: Commodity products up with quotas off
- German: Products and Equipment mostly
- Mexican: (See Preferred Products Page)
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Imported ProductPreference
Both Domestic ProductPreference
GIS & SCADA Analyzers &Manometers
Contractors & Construction
Automation & ControlsEquipment
Filtration Equipmt &Products
Pipe/Water DistributionEquipment
Wastewater Reuse Equipment Treatment PlantSystems
Sludge Handling Systems
Treatment Plant Systems Tanks Gates & Flumes
Data Management Systems* Leak Detection Metal Fabrication
CIS & Meters Laboratory &Sampling Products
Chemical Feed Equipment
Well Drilling/Systems Process EquipmentAerators, Diffusers
Corrosion & CathodicProtection/Control Equipmt
Chemicals Compressors &Blowers
Chlorine
Desalination Equipment Disinfection Systems Coating & Lining
Leak Detection Consulting* Sewer/Collection Systems &Equipment
Laboratory & SamplingEquipment
Pumps & Valves Traditional Treatment Options
Rain Water Reclamation Storm/rain drainage
Solutions
B. Water Product Preferences
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Maximum Levels Allowed
Parameters Monthly Daily
(miligrams per liter, except when Average Average Instantaneous
something different is specified)
Greases & Oils 50 75 100
Sedimented Solids (mililiters per liter) 5 7.5 10
Arsenic 0.5 0.75 1
Cadmium 0.5 0.75 1
Cyanide 1 1.5 2
Copper 10 15 20Hexavalent Cromium 0.5 0.75 1
Mercury 0.01 0.015 0.02
Nickel 4 6 8
Lead 1 1.5 2
Zinc 6 9 12
B. Industrial DischargeRegulation: Nom 002 Semarnat
Less stringent than US & Europe standards;
Lower standard + unclear enforcement = ?
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B. Comparative Water Rates(Price per m3 in pesos, minimum 1000 up to 15,000 meters)
Poorer Area Rates Federal District: 2
Atizapan (Edomex): 5.5
Tlalnepantla(Edomex): 7.6 Leon (Gto): 8.8
Naucalpan (Edomex): 10.2
Tijuana (BC): 12.3
Huixquilucan (Edomex): 15.1
Aguascalientes (AGS):above 25
Richer Area Rates Federal District: 9
Naucalpan: 11.1
Tijuana: 12.3 Tlalnepantla: 13.1
Huixquilucan: 15.1
AGS: above 25
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C. Realities Outline
Government & Societal Realities/Factors
Revenue Realities
Factors affecting Industrial DischargeRegulation
Carrots & Sticks Analysis
Doing vs. Talking Analysis Good vs Bad Projects
BOT Analysis
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C. Limiting GovernmentFactors
- Decentralization- Municipalities and Basins: Domestic & Agriculture
- CONAGUA vs ANEAS
- Slowness
- Process in getting bids out and post-bid process- Budget Process and Payment issues
- Limited government resources, low efficiency
- Corruption
- Tendency towards Traditional Technology- Limited market information from Conagua
- Low cost & prices, limited water revenue
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C. Limiting Societal Factors
Water considered a commodity Population, Farmers, in General
Drinking Water Quality Challenges Problems with source & delivery contamination
Low use and expectations from population Smell, Taste, Consistency, Minerals
Low demand for tap water, strong bottled water sector
Most bodies of water contaminated
No polluted body of water has been recouperated Low societal expectations for water Culture: Avoid complaining, find a way around
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C. Revenue Realities
Federal/Conagua Conagua income
stream = no growthand below preNafta
1994: 9.7 Billion pesosvs. 8.1 Billion in 2006
Revenue emphasis upbut still problematic
Low subsidized ratesto local entities
Bill 20% of industrial &commercial directly
State/Municipal Decentralization:
Transfer of Authority &Responsability without
sufficient revenues Politically impossible
to increase domesticend-user rates
80% of industrial &commercial billed butcorruption/inefficiencyaffect income stream
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C. Factors Affecting IndustrialTreatment Viability & Action
4 Principal Factors
A. Cost of Water
B. Regulatory
Environment- Inspections & Fines
A. Importance of waterin mfging process
B. Level of pollutionfrom mfging process- Sugar, Textile, F&B
Degree of Concern
A. Cost: North vs Southand in general
B. Regulatory: Veryambiguous coverage 60% vs 40% vs < 20%
Federal, State, Muni?
C. Heavy water usersseem to be targeted
D.Unclear to what extenthigh polluters targeted
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C. Wastewater discharge:Carrots & Sticks
Government Regulations NOM 002 Inspection and Declaratorias Process
In effect since 1998, previous regulations voluntary
Required compliance, periodic inspections, payment of dischargerights (vs. fines) when non-compliant
Next step: requirements according to pollution levels of specificwater basins and municipal discharge levels
Sufficient regulations, insufficient enforcement
Unclear regulatory responsibilities (local vs. federal)
Still questionable water official regulation: whimsical
Enforcement differences: New vs. Existing companies
When economic crisis hits, authorities tend to back off
2010 Goal: 100% compliance; Reality: 20-40%
Carrots & Sticks are just not there or on the horizon
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C. Impact of Carrots & Sticks
Sticks Fines/Discharge Rights
No purchases driven by fear
Different in parts of Latam
Amounts not worrisome
Closures
Do not hear about them
Strategy of targeting new vs. Existingcompanies
Crisis or not,
Enforcement
Do not hear companies complaining
about it (like tax) Corruption vs inefficiency
Carrots
Few and ineffective
No true incentive programregarding potable use orwastewater treatment
No tax incentives for installationof systems
ProSanear Program
Discharge fees paid will bereimbursed if an effort is madeto comply
86 companies in 2009, 34 morein 1st Qtr 2010
Repayment: Not annual
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C. Doing vs Talking: Status ofTreatment Plants Projects
Cons (Talking) Atotonilco bid dispute Concerns about 2010 timing of
Caracol & Zumpango plants Rumors of delays with Nextlalpan
& Vaso El Cristo Plants Some Conagua official comments
about lack of funds for 2010 Apparent slow down in projects
and awards Classic & New Budget
Assignment Issues Only 17% of 1st Qtr Bids awarded
so far Are authorities being told to slow
spending despite havingbudgeted funds?
Mexico reputation for talking aboutprojects but not delivering
indefinite unexplainable delays
Pros (Doing) 5% GDP spent on infrastructure Since 2006: Over 200 new plants and
43 rehabilitations 50 under construction: end 2009 Recent, Historic Awards
Largest Latam treatment plant inFederal District
Create 60% coverage Two large plants in Jalisco
Create 100% coverage
Conagua officials: 100 new plants in2010
31 bids: 1st Qtr 2010 Funding up, financing ok 2012 goal: 60% coverage: Have to work
on problem, BOT medium-term at best
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C. BOT: Opportunities & Concerns
Mexican govt push before & after crisis Even with continued increased funding for plants &
systems, perception that need more
Well behind world & Latin America in BOT projects Problems & Concerns
Juridic Insecurity concerning contracts Concerns: Local political issues and election impact
Payment Guarantee Issues Poor govt payment image, concerns and trends
Poor govt revenue stream: Water viewed as commodity
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D. LGA Services Outline
Water Sector Activities
Why LGA Can Help
LGA Website & Materials LGA Services for Water Sector
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D. LGA Water Sector Activities
15 Years working with Wisconsin companieswith products for water sector
2 years of formal & extensive water focus Quarterly Mexico Water Report
Monthly compilation & review of water bids &awards
Development of Intermediary lists Distributors, Reps, Integrators, EPCs, Consultants
Winners of Awards, Participants in Bids Interaction with local water officials and
intermediaries for early project information
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D. Why LGA Can Help
We understand the water sector pretty well Study it every day (clients, Quarterly, Bids) Knowledge increasing continually
We know many key govt officials Continuous/Regular Outreach at federal and local levels
Reaching out to water officials in 12 states
We know many of the intermediaries/integrators Reaching out for searches, networking Following them via bids (winners, participants) We may not know them, but we know how to locate them
We know that what we do not know we can find and understand
Strength: focus on a particular company & identify success strategy Private: 15 years of industrial & commercial sector research, market
analysis, business development, intermediary searches Public: Active & focused on segment like no other firm in Mexico
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D. LGA Website & Sector Info
New Website: www.lgaconsulting.com
Water Section: Bids, Services, Clients, QuarterlyWater Report
Staff of 7, experienced and bicultural List of Water Sector Clients
Pumps/Meters/Valves, Filtration, Municipal,Residential/Retail, Industrial, Commercial
Blog & Presentations Variety of Water Issues
Specific Services: Water Sector Products
http://www.lgaconsulting.com/http://www.lgaconsulting.com/ -
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D. LGA Services: Water Sector
Water Product Market Analysis Water Product & Channel Viability Analysis Project & Client Business Development
Early Sales Pipeline Assistance: Customer research& qualification, database development, prospectingcalls, assessing competition
Intermediary/Partner Location Distributors, Reps, Integrators, EPCs, Partners
Intermediary & Client Evaluation for business &payment issues Related legal, regulatory, fiscal services
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Annexes
Demand for Water 2020
Domestic Water Price Comparison
Commercial & Industrial Water PriceComparison
Tips on winning projects
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Km3/year (m3/s)
National Agriculture Industry Public Other Difference
Supply 2020-1997
3180 2640 95 381 64 856
100 83% 3% 12% 2% 27%
Water Demand by Sector (2020)
Other Sources establish current water demand as:77% Agriculture, 12% Public, 9% Industrial.
B D ti W t P i
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Naucalpan AGS Naucalpan AGS Naucalpan AGS
DOLLARS 30-45m3 31-50m3 75-100m3 75-100m3
Domestic A Popular A $8.72 $25.20 $48.64 $235.36
(Price per additional m3) $0.76 $2.42 $1.25 $10.08
Domestic B Popular B $21.12 $32.16 $72.72 $300.96
(Price per additional m3) $1.00 $2.83 $1.63 $10.08
Domestic C Medium $22.32 $38.00 $74.64 $347.20
(Price per additional m3) $1.01 $2.83 $1.55 $12.16
Domestic C High $22.64 $38.00 $76.08 $347.20
(Price per additional m3) $1.04 $2.83 $1.50 $12.16
B. Domestic Water Prices:AGS vs. Naucalpan
Aguascalientes (AGS) considered most expensivewater in Mexico; Naucalpan average/low.
B. Commercial & Industrial Water Prices:
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B. Commercial & Industrial Water Prices:AGS vs. Naucalpan
How do they compare to the US?
Are they sales drivers or inhibitors?
Naucalpan AGS Naucalpan AGS Naucalpan AGS
DOLLARS 75-100m3 75-100m3 500-700m3 500-1000m3 1200m3 plus 1500m3 plus
Commercial $133.12 $339.52 $1,929.04 $2,502.00 $5,313.28 $6,139.60
(Price per additional m3) $3.09 $8.88 $4.35 $4.04 $3.42 $2.42
Industrial $136.32 $414.24 $1,929.04 $2,607.04 $5,313.28 $6,244.64
(Price per additional m3) $3.16 $10.08 $4.35 $4.04 $5.30 $2.42
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C. Tips on winning projects
Foreign companyproblems Importance of Mexican
intermediary Public: all bids must go
through local entity Private: Less so but still
key to success
Keep tabs on projects Intermediaries not always
proactive or dont/wontshare info
Competition & Bribes Non-US companies: get
business at any cost.
Tips for Success Develop relationships with
Mexican intermeds
But dont give exclusivitynor rely on them
exclusively for Market Information
Business Development
Early access to entity Spec Development key
Right Intermediary key Bring Financing Plan
Avoid non-ProfessionalWater Officials & Entities