| Ondeo (SUEZ) Wins The World's Largest O&M Water Services Contract In Puerto Rico
-- $4 Billion Over 10 years
May 2, 2001 - Ondeo (SUEZ), with its North American subsidiary United Water, has been awarded a 10-year, $4billion contract (an average of $400 million in annual revenues) for the operation and maintenance (O&M) of the water and wastewater services of the Commonwealth of Puerto Rico. The contract, awarded by the Puerto Rico Aqueduct and Sewer Authority (PRASA), is the largest O&M contract for water services ever awarded. This historic contract confirms Ondeo's leadership position in the North American market.
The contract, which includes an extension provision, covers the production and distribution of drinking water for Puerto Rico's nearly 4 million residents, as well as the collection and treatment of wastewater for the entire island. The operator is responsible for operation, maintenance, and renovation of the infrastructure, for client service, and for human resources management.
The contract calls for management of the entire PRASA system, which consists of:
133 water treatment facilities
68 wastewater treatment facilities
Approximately 7,700 miles of water distribution pipelines
Approximately 3,900 miles of wastewater collection pipelines
30 customer service centers
Nearly 6,000 employees
The award of the contract follows an international call for tenders focusing on three primary objectives:
Support for the Agua para todos (Water for All) program which was launched recently by Puerto Rico's Governor, and which is aimed at providing a oconsistent, adequate supply of water to the island's residents and at extending water systems to areas that
are not currently serviced Compliance with health and environmental standards set by the U.S. Environmental Protection Agency and the U.S. Department of Health The optimization of the Puerto Rican government's program of investment, which is designed to improve water systems infrastructure.
O&M contracts allow local governments to delegate management of their water and waste water systems to private operators while retaining ownership of the systems
themselves. The U.S. market for delegated management contracts, which help local governments to increase operating efficiencies, reduce their costs, and gain access to funding for infrastructure improvements, has grown steadily over the last several years and is expected to continue its expansion.
In 2001, Ondeo, the water division of SUEZ, generated revenues of $2.1 billion in North America, in the areas of management of municipal water and waste water systems (United Water), design and construction of water treatment facilities (Ondeo Degremont), and services to industrial customers (Ondeo Nalco). The award of the PRASA contract is a major step in Ondeo's consolidation of its leadership in the North American market, which, after Europe, is its most important geographic base of operations and a key focus for growth for both Ondeo and SUEZ.
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