Wangxiaoying Wastewater Treatment Plant

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In November 2004, Berlinwasser International AG (BWI) was awarded the 23-year concession contract for the operational takeover of the 310,000 cubic meters per day Wangxiaoying Wastewater Treatment Plant in the Chinese provincial capital of Hefei by the Hefei city government via international tender. It was intended that the project play a leading role in improving water quality in Lake Chaohu and the Nanfei River, the only two water sources available to Hefei and its population of more than four million. To implement the contract, Hefei Wang Xiao Ying Sewage Treatment Co., Ltd. was set up as the project company, a joint venture between BWI and its state-owned Chinese partner The East China Engineering Science & Technology Co. Ltd. (ECEC). The exact shares in the project were not public. According to the Hefei Development and Planning Commission (HDPC), plant construction started in 1993 for about RMB300 million, part of which was financed with an ADB loan. The plant had been losing money since it started operating in 2002, putting a strain on the Hefei city government's finances. The government decided to sell the operating rights to either local or international investors by way of a public tender, which was launched in August 2003 at an indicative price of RMB268 million. Berlinwasser International consortium ended up paying a price of RMB480 million (US$58 million), 79% higher than the indicative price, outbidding offers of RMB450 million from the Hong Kong-listed Tianjin Capital Environmental Protection Co along with two others. The JV was to retain all profits or bear all losses resulting from the plant's operation. Further investments during the operation period were planned, but nothing was committed. Since the completion of construction in 2001, the plant ran in regular operation and disposed the sewerage of about one million people. None None