Zhongshan Tanzhou Water Plant

Active

Prospective

In October 1992, Sino-French Holdings was awarded a 30-year concession contract with the municipal government of Zhongshan to take over and upgrade an existing water treatment plant and distribute drinking water in Tanzhou Township, Guangdong Province. The plant had a production capacity of 58,000 cubic meters per day for about 100,000 end users in Tanzhou. To implement the contract, the Zhongsan Tanzhou Water Supply Company Ltd was created as the project company in which Sino-French took a 58% stake while the state-owned Zhangsan Tanzhou Economic Development Company held the remainder. Sino-French, in turn, was a 50-50 joint venture between Suez water subsidiary Ondeo and New World Infrastructure of Hong Kong. The total project cost was US$10.8 million. The project reached financial closure in May 1994 and construction completed in September 1995. The JV was financed with 40% equity investment, while the remaining 60% was paid for with a shareholder’s loan. The operations started in November 1997. http://www.nwsh.com.hk/eng/pdf/w15_zhongshan_tanzhou.pdf According to the JV, during the first half of 2000, the number of customers reached 10,326 and water consumption amounted to 6.1 million cubic meters, a 27.9% and 10.9% increase since the start of the contract, respectively. UFW was also reduced from 40% in 1992 to 13.8% in 2000. Factiva: "The 90-million-renminbi ($10.8 million) venture in Tanzhou is unique because Sino-French not only sells water to the utility, it owns half of the utility itself." According to NWH, it holds 29%, not 25% of the company, meaning that Suez also holds 29%.

Water and sewerage

China

High

World Bank Group

Project

Water Supply and Storage, Government, Power Transmission, Commercial, Power Generation (CCGT), Waste Processing and Treatment