Market Research

Contents ----------------------------------------------------General Information WWTP situation in Indonesia Foreign Investment Competitor (K-turbo) Biggest WWTP plant location WWTP machines manufacturing company list Summary & opinion

General Information : Population - 245 million people. Language - (Basha Indonesia), English, Dutch. Labor force - 1, 16,500,000 (2010). GDP per capita - (ppp) - $4300 (2010). Wastewater treatment plant situation in Indonesia : Population of community in Indonesia grows significantly slight especially in urban area. This condition may impact to environmental support capacity deterioration. That impact must be treated definitely, particularly for the use of waste water treatment. The increasing number of community will increase consumption of drinking water and directly impacted to increase waste water production. As we knew that around 80% water consumption becomes waste water. Waste water disposal without treatment process will cause environmental contamination, especially contamination water sources for drinking water, water surface or ground water.

Water resource & infrastructure in Indonesia

Waste water treatment (WWT) needs infrastructure and distribution facility and treatment. The sewerage system service in Indonesia just cover eleven big cities are Balikpapan, Banjarmasin, Bandung, Cirebon, Jakarta, Medan, Prapat, Surakarta, Tangerang, Yogyakarta and Denpasar. Service coverage is typically less than 10% of the city population. Their management is 2

inefficient. And their operating costs are heavily subsidized. Mostly municipal WWT can be handling through onsite system with septic tank. An estimated 70 million people in Indonesia are inadequate of sanitation facilities. From the amount of it, 40 million people lack of basic sanitation facilities at all. While, 30 million people only have low sanitation facility standard as cubluk (digging land for defecate) or helicopter toilet (defecate above river or surface water) that is not meet the health and the environment standard. Indonesia legalize MDGs target to Reducing by 50% proportion of the population having no access basic sanitation facilities in 2015. The target of basic sanitation access in MDGs is 65% and already achieved by year 2006. But this accomplished target is not considering to quality of sanitation.

Peoples access particularly urban-poor to waste water (sanitation) infrastructure and facility is still low. Up to present, urban-poor generally do not think about sanitation as basic need. They are more concerned about what to eat today. They do not realize that sanitation can prevent them always healthy, so they do not need to spend money to maintain health and work productivity remains high and therefore they will improve their income and prosperity. The urban-poor generally live in dense area. They live with limitation of environment quality,

access to water, and sanitation facility. If they have basic sanitation, they did not consider about technical requirement. Finally this condition still worsens the quality of environment. To reduce quantities of worse sanitation in urban area, Indonesia government introduce SANIMAS program to improve urban-poor sanitation since 2001. The pilot project of SANIMAS (community-based sanitation) program was initiated by AusAID through WSPEAP World Bank (Water and Sanitation Program East Asia Pacific) and was supported by the government of Indonesia. Until 2008, SANIMAS has been implemented in 27 provinces, and more than 300 locations. While 2009 SANIMAS project have been planned in 82 locations and still in procurement process. Through SANIMAS program, urban-poor necessity to basic sanitation may carried out. As we knew that SANIMAS have used DEWATS technology by BORDA on specific location, while the rest location used modification of DEWATS technology. The impressive of replicate of this SANIMAS is interesting to review and evaluate what the successful factors are, obstacle in location, environment and social improvement through implementation of SANIMAS. Within the period of October 2002 till July 2003 a feasibility study within the framework of PESP 02086 has been performed. The goal of the study was to test the feasibility of the application of the Biobed EGSB technology for the treatment of the wastewater of the Jababeka. The feasibility concerned the technical as well as the financial and economic aspects of the high rate anaerobic process. Jababeka is an industrial estate just near Jakarta in Indonesia. It provides gas and electricity and it treats all the produced wastewater of the more than 350 companies, at their Waste Water Treatment Plant (WWTP). This system consists out of 3 conventional oxidation ditches of each 4500 m3. Since the capacity of this WWTP will be limited due to the extension of the industrial estate, Jababeka is planning to extend the capacity. Since the high rate Biobed EGSB process offer several advantages in relation to the 4

conventional aerobic process (e.g. no oxygen consumption, biogas productions, less surplus sludge production, higher volumetric loading rates) Jababeka was very interested. Within the mentioned period, the technical feasibility have been tested on site by means of a Pilot Plant, based on the outcome a process design has made, the investment costs and operational costs were calculated in order to determine the feasibility of the investment. Foreign investment for WWTP in Indonesian market : The WWTP as designed and worked out for Jababeka shows well investment efficiency. The WWTP is an good example of the potential for this type of high rate wastewater treatment processes in the Indonesian market. Hereby Dutch suppliers as Biothane and Plasticon will act as design and technology supplier and participate as a sub contractor for the full-scale projects. An Indonesian main contractor will do the project execution. In common it can be stated that there is a big potential for Industrial wastewater treatment in Indonesia, since there is an enormous latently need for environmental measures in order to control the water quality. There is a strict policy for environmental issues, but there is a lack on law enforcement. Though, due to the growing public awareness, the commitment of authorities is increasing and becoming more active. The need for wastewater treatment, both industrial and sewer wastewater, becomes clear by the total number of municipal wastewater treatment plants (about 10). This is nothing in relation to the number of people on Java (> 10 million people). Most industries have done several investments for the treatment of the their industrial wastewater, but the applied processes showed to have a low basic technical and technological quality. Thereby there is hardly any maintenance and processes arent controlled optimal. At this moment there is hardly direct financing for the support of private projects. The organizations as ADB (Asian Development Bank), WB (World Bank) and OECF (Oversees Economic Corporation Fund) do stimulate projects concerning municipal treatment of 5

wastewater and infrastructure. There are only a limited number of players on the market of industrial anaerobic wastewater technology with a good reputation. The players who are active are associated to foreign technology suppliers. The challenge for Dutch companies is to conquer the Indonesian market from the inside, to get better acquainted with the local market. Considering the big potential of the Indonesian market, it is a must to be on the market from the start. A pioneer will create better changes than foreign companies joining the market in a later stage. To pioneer the market contains certain risks. For this extra investment costs have to be made and the market has to be "discovered". The most potential clients are the international investing companies. These companies have most of the time their own standards for the development of treating their wastewater and dont automatically follow the local habits and standards. As mentioned before the law concerning environmental policy is well developed. The problem is that there is no well system (organization) which executes a structural control for observing if the companies act upon the law. Thereby if there are illegal activities, there is no active organization for sanctioning these disobediences. As also stated before, the trend is that this is changing. There is more public awareness for environmental issues and as a consequence there is a development of more commitment of the authorities and law enforcers. Especially foreign and global international investing companies are controlled and checked very strict on their environmental policy and direct related precautions and achievements. These clients are the first bases for success and development of the market for industrial wastewater treatment. A clear example of increasing pressure concerning environmental issues by the local communities is actions taken by the community against companies which show to have misbehaved on environmental laws. Thereby the government has been developed a color 6

rating system. By means of this system the government categorizes companies about the activity on environmental protection policy and measurements. Thereby the performance of companies on these issues are made public. This way the government tries to stimulate companies to take action and that they feel themselves enforced to protect or to improve their companies image. The common trend of the last years concerning international investments in the Indonesian market showed that these were reserved. Main reason has been the political crises from 1997 and some political rumors afterwards. The expectation is that if during and after the coming elections the political climate remains stable, the economy will grow and proportional with this trend, it is expected that the investments of the (international) companies will increase. The basic thought for this hypothesis is that the self-trading part of the Indonesian people will grow economically and will finally result into a big impulse of the economy. Biothane is acting on these market developments. Butanes Representative Office, Biothane Asia Pacific has been extended the last year with 3 more Indonesian engineers and 1 Dutch commercial manager. Thereby legal status of the company will be changed from Representative Office to an independent PT (equal to: Besloten Vennootschap (The Netherlands) and Limited (Great Britain)). Besides the expansion of the BAP organization, it is planned to start a representative office in China the beginning of next year. Considering the expansion of international acting companies in the Asian region, combined with the extension of investments of the international and local industries, Biothane strategy is to participate more intensively in the Asia Pacific market.

Korean competitor K-Turbo (PT. K turbo Pacific, Indonesia) A subsidiary branch of the K-Turbo co. Korea, born in Apr. 30,
2010,

in Indonesia by selling the brand K-Turbo Blower and Turbo Compressor engine,

application of their product are waste water treatment, Flue gas Desulfururizatio, Agriculture and food processing, process plants, Air conveying of powder and bio technology, The product have two model engine blower are TB (turbo blower 0.8-1.3 bar) and TCL ( Turbo Compressor low 2.0-3.5 bar )

k-turbo products in Indonesia.

4 Biggest Wastewater Plant location in Indonesia :

PT. Petro Oxo Nusantara Incinerator (WWT-I) Jl. Gubernur Sutyo Km.1 Tlogo Pojok, Gresik, East Java, 61118 Indonesia Contact Information: Contact: E. Kristianto Email: eddyk@pon.co.id Telephone: 062313973960 Fax: 062313973558 Plant Operation: Industrial. Web site:http://www.pon.co.id/

Plant/Process Description: PT. Petro Oxo Nusantara, a petrochemical company in Indonesia that produce octanol and Nbutanol. One of the process waste water is 0.5 mr/hr of 8% NaOH solution that are contaminated by process hydrocarbons. It has 80.000 - 160.000 ppm COD. The Noah waste water are burned by natural gas fuel in the waste water treatment - I (Incinerator Unit), and the oil content of effluent water will decrease until 3000 ppm COD. The CO2 gas are produced by fuel burning that will be disolved to effluent water as sodium (bi) carbonate, and scrubber by water to minimize the dust, particles and CO2 are going to the atmosphere air (environment concern). Then the effluent water are pumped to the next waste water treatment (activated sludge system) to reduce COD until below than 100 ppm (regulation standard). The flue gas of incinerator are monitored by internal lab. and independently lab. Owner: PT. Petro Oxo Nusantara Web site: http://www.pon.co.id/ Operating Company: PT. Petro Oxo Nusantara Web site: http://www.pon.co.id/

PT. Petro Oxo Nusantara WWTP II Jl. Gubernur Suryo Km.1, Tlogo Pojok, Gresik, East Java, 61118 Indonesia

Contact Information: Contact: E. Kristianto Email: eddyk@pon.co.id Telephone: 06 231 397 3960 Fax: 06 231 397 3558

Plant Operation: Industrial Processing: Wastewater

Plant/Process Description: PT. Petro Oxo Nusantara, a petrochemical company in Indonesia that produce octanol and Nbutanol. The 3 m3/hr (avrg) of raw waste water from process plant is treated by waste water treatment II with activated sludge system. In this activated sludge system is applied aeration tank. BOD and COD in raw waste water substance is removed by biological (microorganisms) using oxygen supplied by air blower. Also, it is supplied urea and diammonium hydrogen phosphate as nutrient to reach BOD:N:P=100:5:1. In this aeration tank is provided pH control system. The biologically treated waste water overflow from the aeration tank into clarifier, it is separated into supernata The precipitated sludge is return to the aeration tank by pump. The amount of excess sludge

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to be discharged is controlled with reference to the sludge concentration in the aeration tank, and is discharged to the sludge slurry tank. The clarifier is equipped with a skimmer, which collects and transfers the scum floating on the clarifier surface to the scum tank. The treated water are collected and neutralization in the neutralization tank before disposal to outside the battery limit of plant. 98% sulfuric acid and 48% caustic soda is used. Air mixing is supplied in this tank. The treated water are monitor and control the quality which refer to the local regulation. Owner: PT. Petro Oxo Nusantara Web site: http://www.pon.co.id/ Operating Company: PT. Petro Oxo Nusantara Web site: http://www.pon.co.id/

PT Riau Andalan Pulp & Paper Company Water Treatment Plant Kerinei

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Pekambaru, Riau Province Indonesia

Contact Information: Email: info@aprilasia.com Telephone: 62 (761) 491 000 Fax: 62 (761) 95278

Plant Operation: Industrial

Processing: Water

Web site: http://www.aprilasia.com/environment_mill.html

Plant/Process Description: At Kerinei in Riau Province on the Indonesian island of Sumatra, the PT Riau Andalan Pulp and Paper company operates the worlds largest single chain pulp operation. Full scale production requires 18,000 m3/h of treated water for process and boiler feed. Against international bidding, contracts for both the filtration and demineralization plants were awarded to total water management company, Ion Exchange (India) Ltd. The clients consultant was Jaakko Poyry of Finland. Source of water for the water treatment plant is the Kampar River; water is pumped from a riverside pump house through a five kilometer long pipeline. Due to its high content of organic matter and iron, the water is colored. Raw water is fed to a cascade aerator where it comes into contact with atmospheric air. Aeration of the water and release of carbon dioxide from the water, both help to precipitate iron. From the aerator water passes into four clarifiers of solids-contact type, each treating 4500

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m3/h of water. These clarifiers are very efficient and offer distinct advantages in terms of less floor area, lower chemical consumption and better sludge consistency. Moreover, this type of clarifier is much less affected by changes in flow rates and in raw water characteristics. Chemicals such as alum, caustic soda, chlorine and polymers are mixed with the raw water. Clarified water passes through a series of eight filters with unique features. The filtering medium a mixture of sand and anthracite allows depth filtration and longer filter runs. Backwash water is provided by filter beds in service. Therefore, no backwash pumps are required as with conventional gravity filters, resulting in significant savings in installation and power costs. The backwash (dirty) water is recycled back to the clarifier and hence there is no wastage of water. Filtered water is then stored in a tank, from which it is pumped for process use, as well as for supply to the demineralization plant. The filters and clarifiers are operated through a digital control system from the control room. Water from the filtration plant is de-chlorinated as it passes through a 6 x 270 m3/h demineralization plant; each stream includes a cation unit, degasser, an anion unit and a mixed bed unit. The cation and anion units are designed for countercurrent regeneration. This helps to produce treated water of the highest quality with minimum consumption of chemicals. Water treated in the mixed bed unit is then stored in two large demineralization tanks. The entire plant has been engineered for maximum convenience of operation and management. It has also been specially designed for outdoor operation. The plant is fully automated with instruments that provide signals through a digital control system. Owner: The Asia Pacific Resources International Holdings Ltd. Web site: http://www.aprilasia.com/ Operating Company: The Asia Pacific Resources International Holdings Ltd. 13

Web site: http://www.aprilasia.com/

PT. Heinz Suprama WWTP Jl. Raya Sidoarjo Km.3 Desa Suko Sidoarjo, East Java, 61251 Indonesia

Contact Information: Contact: Mrs. Tulagustin M. Email: tulagustin.muninggar@heinzsuprama.co.id Telephone: 062318963765 Fax: 062318963764

Plant Operation: Industrial

Processing: Wastewater

Web site: http://www.heinzsuprama.co.id/

Plant/Process Description: PT. Heinz Suprama is a food industry. All plant waste water are treated to the WWTP. The treated water quality of WWTP outlet is kept and controled by EHS section, it refers to local regulation standards. The WWTP has eight steps. Tank No.1 eliminate the floating materials (such as debris, foods, oil,etc.). Tank No.2 eliminate sediment materials. Tank No. 3, 4, 5 until 6 reduce the BOD

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and COD that applied a microorganisms (bacteria). In those tanks, aeration of the water is applied. Tank No. 7 separate water from the suspended solid or activated sludge. Tank No. 8 tune the water quality to reach the standard requirement. Owner: PT. Heinz Suprama Web site: http://www.heinzsuprama.co.id/ Operating Company: PT. Heinz Suprama Web site: http://www.heinzsuprama.co.id/ Indonesian Wastewater plant distributors list :

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Summary : Indonesian cities only have rudimentary sewerage systems, so that urban households either rely on private septic tanks, or dispose of human waste directly into rivers and canals. Septic tanks, however, are rarely maintained properly, causing overflows which contaminate groundwater supplies, including the shallow wells upon which most urban households depend 16

for their potable water. After finish my market research in Indonesian WWTP market, I would like to say for Neuros has a big chance to enter in Indonesian market. The market growing up so rapidly and lot of foreign investors investing money in various market sections. Strength for Neuros : If we look closely the Indonesian economy and culture, economy being better day by day, also the culture of Indonesia is quite similar with Korea because of a lot of Korean population growing there & cause of Asian country. 70 million people in Indonesia facing a big problem of wastewater, sanitary in their daily life. So, their slogan is to make WWTP & long live. In this situation Neuros should enter Indonesian market, not only for business but also for green environment. Even now Indonesia has a lot of WWTP companies and distributors; they dont use the modern and advance technologies and machines like Neuros. It will be a great chance for Neuros present its advance technology. Threats : After look all the websites and WWTP market most of the Indonesian WWTP companies getting huge aid from Dutch companies and Banks. As we know Indonesia is a country of colonized by Netherlands so, worlds most powerful WWTP competitor is Siemens already in Jakarta, As I mentioned in the report, SANIMAS project have been planned in 82 locations and still in procurement process in the year of 2009. So it will be very difficult to get market share. Secondly, even in Korean market Neuros big competitor is K-turbo, already in Indonesian market made a branch in Jawa Timur province. They selling almost the same turbo blower and compressor like Neuros.

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Important URL : 1. http://www.bioseptic.co.id 2. http://www.indexmundi.com/indonesia/exports.html 3. http://www.eco-web.com 4. http://www.waterandwastewater.com/ 5. http://www.indowater.com/ 6. http://www.metrocouncil.org/news/newsrel.htm ] 7. http://pt-kturbo-pacific.indonetwork.net/pt-k-turbo-pacific.htm

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