INTRODUCTION FERROSTAAL GROUP INDONESIA German-Indonesian Conference, Jakarta, 17 th November 2014 Innovative Technology to Tap Indonesia s Bioenergy Potential Industrial Services for the Implementation and Operation of Biogas Plants - Converting Potential into Value -
Providing Industrial Services in Indonesia from Project Feasibility Work to Financing and Maintenance of Industrial Plants 1. Company Introduction 2. Industrial Service Provider 3. Bioenergy Market Potential in Indonesia Opportunity & Challenges 4. Positioning of German Bioenergy Technology 2
MPC Group Structure MPC Holding MPC Marine MPC Capital MPC Industries Ferrostaal Group 3
Ferrostaal Corporate Identity Ferrostaal is a global industrial service provider with financing competence. Our company act as a project developer and provider of EPC services for industrial plants, as well as being a sales and service partner for various industrial machinery. Our clients and partners profit from the overall strength of the Ferrostaal Group and our international presence. With companies in around 40 countries we are one of the best positioned industrial service providers in the world. Around 3,600 employees provide the on-location ties that link our industrial expertise and financing competence to our clients. 4
Ferrostaal History Our Experience Your Advantage Milestones in the company s history 1920 Ferrostaal N.V. founded in The Hague (NL) as a commercial trading company for steel products 2007 Largest petrochemical order in Ferrostaal s history 1930-1934 Entry into the Essen Commercial Registry as "Ferrostaal AG". Establishing foreign offices in India, Argentina, Uruguay, Peru and Chile as well as sales offices in New York and Shanghai 1991 First petrochemical plant in Trinidad and Tobago 2010-2012 Expansion of activities in North Africa, Asia and UAE 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 1934-1960 Expansion of sales organizations to cover Bolivia, Ecuador, Columbia, Brazil and Venezuela. Start-up of operations in China, Greece, Turkey and Iran. 1996 Establishment of services for the automotive industry 2012 Takeover by MPC Industries 1926 The Gutehoffnungshütte steelworks acquires shares in Ferrostaal N.V. 1963 First large scale projects for the petrochemical industry in Venezuela and Chile 2008-2009 Large scale orders for power plants in Trinidad and Venezuela 5
Ferrostaal Group Structure & Business Divisions Ferrostaal Industrial Projects Ferrostaal Industrieanlagen Ferrostaal Piping Supply Focus on Petrochemicals, Renewable Energy and Other Industrial Plants: Project Development EPC Services Financing Focus on Oil & Gas and Defence Industry: Project Development EPC Services Financing Global trading network Warehouse & Logistic services Consulting & Financing Ferrostaal Equipment Solutions Focus on Environmental / Recycling machinery, Packaging and Tooling machinery: Distribution & After Sales Services Financing Ferrostaal Automotive Supply-Chain-Management for the Automotive Industry: Process Development & Engineering Assembly & Just-In-Sequence delivery Intergrafica Print & Pack Focus on Graphic Arts Industry: Distribution & After Sales Services Consumables sales Financing 6
Ferrostaal Group in Indonesia In a nutshell: +40 years presence in Indonesia Trading platform with extended Project Management teams Experience team specifically for mining / metals industry New strategic fields covering bioenergy and construction materials industries EPC / construction business license (grade 7) Warehousing for spare parts and consumables for our clients Dedicated service teams across our network of branches (Jakarta, Bandung, Surabaya, Semarang) >50% of revenue supported with financing arranged for our clients 7
Providing Industrial Services in Indonesia from Project Feasibility Work to Financing and Maintenance of Industrial Plants 1. Company Introduction 2. Industrial Service Provider 3. Bioenergy Market Potential in Indonesia Opportunity & Challenges 4. Positioning of German Bioenergy Technology 8
Project Development & Investment Advisory Ferrostaal integrates the individual stakeholders into the projects and optimizes the lifecycle Partner Scope Licensing Engineering Key-Suppliers Local Partners Influences: Cost of Energy Project-Management Financial Engng. Technology Engineering Procurement Civil / Erection / Commissioning General Contractor Project Developer Your Project- Bioenergy Company Investment (Investment) Project Company 28% ECA- Coverage Equity Investor Exit Infrastructure Debt Capital Financing Strategic Investor Interest Productprice $ / Feedstock Utilities Spares O&M Product Off-take (incl. Logistic) 9
Project Management Realisation and Principle Value Chain FS Legend: General Contractor / Leader of international Consortia FS Managed by Ferrostaal Provided by Ferrostaal P Managed by Ferrostaal Provided by reliable partners FS FS Project & Risk Management Tailor made Project Financing Project Development Phase Project Concept FS Project Financing EPC - Engineering Procurement Construction Contracting Phase Basic / Detail Engineering FS FS P FS Global Procurement FS Civil Works & Erection P Test & Commissioning P Operation & Maintenance P Operation & Maintenance Operation & Maintenance Ferrostaal is managing the entire Value Chain of Large Scale Projects in various industries Petrochemicals & Fertilizer Environment & Renewable Energy Oil & Gas / Defense Industry Minerals & Metals 10
Advisory based on Experience 11
Financing Competencies Tailor-made Financing Solutions Our customer can count on us for tailor-made and reliable financing solutions for machinery lines, as well as productneutral concepts for project and export financing. Thanks to our structured solutions for export financing and our willingness to assume responsibility for procurement and logistic activities, we make it possible for our clients to expand their businesses worldwide. Following financing solutions can be structured: Export Finance (ECA covered) Limited Recourse Project Financing (on-balance) Non-recourse Project Financing (off-balance) Financial lease (on-balance) Operational Lease (off-balance) 12
Providing Industrial Services in Indonesia from Project Feasibility Work to Financing and Maintenance of Industrial Plants 1. Company Introduction 2. Industrial Service Provider 3. Bioenergy Market Potential in Indonesia Opportunity & Challenges 4. Positioning of German Bioenergy Technology 13
Palm Oil Potential Waste to Energy Potential Indonesia is the largest palm oil exporter, supplying more than 50% of global palm oil demand More than 600 Palm Oil Mills (POM), with main production sites on Kalimantan and Sumatra; Potential electricity generated from liquid effluents: 1 POM = 2-6 MW Total of 600 POMs = up to 3.600 MW Low electrification rate in Indonesia (below 70%) and frequent shortage of electricity supply from the central power grid, favours decentralized power generation, specifically if generated from renewable sources 100% fresh fruit bunches (FFB) as feedstock of a palm oil mill, generate: ~20% Crude Palm Oil (CPO), ~60% POME and ~20% other waste, such as fiber and empty fruit bunches (EFB) Turning POME into electricity for own consumption and/or selling it to the grid, is leading to operational cost saving for the POM and/or attractive additional revenues New feed-in-tariff (issued Oct 14): Rp. 1.050,- x F / kwh ( F, location factor as variable) Main benefits of a Biogas Plant Investment for POM Owner: Increased revenues from potential export of electricity (new tariff defined by measures of economic viability of new biogas plants) Reduced energy cost and depency on fossil fuel (reduced diesel usage in the POM) Reduced POME treatment costs in lagoon systems and higher utilisation of the POME nutritions Reduced greenhouse gas (GHG) emissions POM Owner can be certified with Green Producer of CPO, as per RSPO/ISPO guidelines Potential earnings from emission reduction certificates (carbon credits) 14
Full of Challenges...BUT... CHALLENGES OPPORTUNITIES Electricity cost increase Competition over good employees -> O&M support and training required Strong domestic feedstock base (all basic commodities) High entry cost / efforts (Comparably) stable environment (Social / Political) Corporate Governance (Compliance / Efficiency) GoI shifting budgets from fuel subsidies towards infrastructure investments and support of renewable energy sector From consumer-market towards manufacturing-market 15
Providing Industrial Services in Indonesia from Project Feasibility Work to Financing and Maintenance of Industrial Plants 1. Company Introduction 2. Industrial Service Provider 3. Bioenergy Suplly Potential in Indonesia Opportunity & Challenges 4. Positioning of German Bioenergy Technology 16
Positioning of German Industry Our Image (?) Technological Leadership Environmental friendly Loyal, long-term partners Over designing Expensive Our Positioning (?) Weak overall trade balance (see e.g. Japanese leverage) We need a comprehensive market strategy (vs. we fix it on the way ) In the center of Asian Competition (China, Asean) Failure of low-cost purchasing strategy Rising labour cost driving for automatisation 17
Positioning of German Industry - Converting Potential into Value - HOW CAN YOU (WE) SUCCEED? COORDINATION - Ekonid, GIZ, others COOPERATION - B2B platforms INTEGRATION - Integrated offerings and strong market presence
Turning Ideas into Reality. Gedung Menara Jamsostek Menara Utara Lantai 23 Jl. Jend. Gatot Subroto Kav. 38 Jakarta 12710 - Indonesia Phone : +62-21-2966 6869 Fax : +62-21-2966 6878 www.ferrostaal.com www.ferrostaal.co.id 19