November 2015 - Air & Water Monitoring Insights 57

More Than 50 Percent Of The World’s Ultrapure Water Products Will Be Purchased By Just 50 Companies

Power plants, electronics manufacturers and pharmaceutical producers will spend $4.6 billion in 2015 on products and services to purify water to such an exceptional degree that there is a whole classification called “ultrapure” water. This purity is obtained with a combination of chemicals and physical process steps such as reverse osmosis (RO) and ion exchange.

The purchases will be concentrated among relatively few companies. The top 20 companies will purchase 37 percent of the total products and the top 50 companies will average more than 1 percent each ($23 million).

The top 8 semiconductor companies will account for purchases of $795 million. The top 10 power generator purchases will total $625 million. The top 4 flat panel and other electronics manufacturers will spend $284 million.

#	Company	Semi	Other Electronic	Power
1	Samsung	x	x
2	Intel	x
3	TSMC	x
4	EDF			x
5	LGE		X
6	Sony	X	x
7	SK Hynix	X
8	Micron	x
9	China Datang			X
10	China Guodian			x

Pfizer is the top pharmaceutical purchaser but is only ranked #23 on the list of the 40 largest purchasers.

The large ultrapure water product purchasers are moving toward global sourcing for several reasons. One is the importance of the products to the plant operations. A single small particle can cause rejection of a $300 chip. Contaminated drugs are one of the biggest concerns of pharmaceutical companies. The ultra supercritical power plants which are now under construction require water purity levels far greater than the sub critical power plants which they are replacing.

The second reason for global sourcing is to facilitate evaluations on total cost of ownership. The high cost of these evaluations is spread out among a number of purchases. The benefits of buying the best rather than lowest price products far outweigh the costs.

The combination of concentration of buying power and emphasis on highest quality products creates a new and major opportunity for ultrapure water system, product and service providers. McIlvaine has created a new route to market to take advantage of this opportunity. It combines N029 Ultrapure Water: World Market with other McIlvaine services to provide detailed forecasting of Markets, Prospects and Projects.

It is now possible to precisely segment and predict markets, identify the prospects, and track the most important projects.

A few hundred companies make most of the flow control and treatment purchasing decisions. McIlvaine is identifying them and reporting on their activities.

Detailed forecasting of markets, prospects and projects provides the following benefits:

Improve decisions on allocation of direct sales, promotion and development expenditures

Many companies recognize the importance of large customers and have assigned personnel and resources to them. By providing precise forecasting and organized information on large customers, this major opportunity can be maximized. McIlvaine achieves this with the Detailed Forecasting, Large Project Tracking Program. The important parameters are:

· International suppliers have the best opportunity selling to large international customers.

· Large customer are willing to pay higher prices for higher quality equipment and services and are willing to expend the effort to make a total cost of ownership evaluation.

· Precise forecasting by product, company and project coupled with timely information will provide the supplier with the tools he needs.

Arcelor Mittal is one of the top 200 flow control and treatment purchasers. Arcelor Mittal produces 98 million tons of steel per year at 194 sites. It produces twice as much as the nearest competitor or 6 percent of the 1.6 billion tons of steel produced last year. It is also one the largest mining companies with both iron ore and coal mining capacity. The company has production sites around the globe making it one of the top 200 purchasers of flow control and treatment equipment. Last year it purchased 1.3 percent of the fabric filters and bags. It is a major valve purchaser with some plants operating more than 50,000 valves.

The company has adopted a global procurement program based on total cost of ownership. This program launched in 2007 places emphasis on life cycle cost and not initial price. It seeks long term relationships pooling knowledge and deploying specialized technical knowledge. This means that companies with better products have the opportunity to charge the prices commensurate with product value. They also have an opportunity to provide global service to help ensure the lowest cost of ownership.

Air programs: The Company is focused on reduction of dust, NO_x and SO₂. The capital investment in steel plant air pollution control projects in 2014 was $180 million. Dust emissions were 621 grams per ton of steel produced which is down 24% percent of the 2010 level. NO_x emissions fell 4 percent in 2014 to 1.1 kg/ton of steel and SO_x emissions decreased 3 percent.

Dust emissions from mining operations fell 6 percent to 5.3 million tons in 2014 while NO_x fell 3 percent and SO_x 26 percent (mainly due to a fuel change).

In 2014 ArcelorMittal R&D division worked on 13 air emission projects to improve dedusting systems and also processes.

Water Programs: The steel plants use large quantities of water for cooling and are located adjacent to lakes or rivers. Of 134 steel sites, 20 are located in regions which are experiencing water stress or scarcity. As a result, the Global R&D group is focused on water reuse and zero liquid discharge. The water treatment laboratory in Asturias, Spain is investigating green technologies to minimize pollutants.

Water at the mines needs to be treated before discharge. Water is also used for dust suppression, transporting tailings and concentrating ores. Some mines such as El Volcan in Mexico use special thickeners to avoid the use of tailing ponds.

The Indiana Harbor Works has installed a zero liquid discharge system (ZLD). The Newcastle, S.A. site has just commissioned a $40 million facility to treat wastewater. ZLD is already being accomplished at Saldanha and Vanderbijlpark. Two mine water treatment plants are in design and construction in Kazakhstan. A major water reduction program has been underway in Romania.

Several McIlvaine project tracking systems cover the large ArcelorMittal projects around the world.

Location	Timing	Project Description
Aviles/Gijon Spain	2016-2019	Reconstruction of two of 45 coke oven batteries with collection and scrubbing system.
Ghent, Belgium	2016-2017	$100 million bio ethanol plant using CO gas from steel with eventual capacity of 47,000 tons of ethanol/yr.
Germany	2016	Minor projects in Bremen, Duisburg, Brandenburg and Hamburg including galvanizing lines and new pre heat furnace.
Bosnia -Herzegovina	2015- 2016	New dust filters for BOF furnace with mid 2016 completion date. New filters for sinter plant are already installed. Sinter machine #4 precip internals also replaced.
Calvert Alabama	2015- 2016	$6.7 million for coating line with pumps and $40 million for slab yard expansion.
Ostrava Czech Republic	2014-2016	Valmet is supplying new CFB coal-fired boiler to replace old existing coal-fired boilers. Fabric filters will be used for dust capture.
Ostrava Czech Republic	2014-2016	ZVVZ-Enven Engineering is supplying $25 million DeSO_x project and CKD Phraha is supplying a $50 million DeNO_x system.
Hunan Valin China	2014-2017	New $832 million automotive steel plant.
Acindor Argentina	2013- 2017	400,000 ton/yr. rolling mill was initiated in 2013 with expectation of a two year completion date. Five other production lines at the site produce 1.7 million tons/yr.
Dunkirk France	2013-2015	New $110 million revamp of blast furnace #2 to be completed this year.

There are links to air and water permits with considerable detail on each emitting source:

· Arcelor Monessen coke plant Air permit from 2014-2019 covering coke oven pushing and quenching the desulfurization plant, the coke pushing baghouse and benzene NESHAPS control system but an environmental group PennEnvironment is suing the plant for emitting excess soot, acidic gases and noxious odors since the decades-old facility went back into operation in April 2004.

· Minorca Mine Virginia City Minnesota air permit with requirements for fabric filters and scrubbers used in the concentrating and pelletizing of 9 million tons/yr. of taconite ore to manufacture 3 million tons/yr. of pellets.

· Weirton West Virginia 3 small oil- and gas-fired boilers air permit expires in 2016. A 2012 Title V permit expiring in 2017 covers the reheat furnaces, hot strip mill pickling lines and HCl regeneration. An NPDES permit on the water side covers 18 mgd of cooling water discharge and 9 mgd of treated wastewater.

· Dofasco Ontario facility paid $390,000 penalty in 2014 for excess blast furnace emissions.

· ArcelorMittal Steel USA, Inc. - IN Harbor East, Permit No. IN0000094 - RENEWAL covers iron & steel, rolling mill operations and finishing operations with additional support operations: power generation, wastewater treatment with discharge to the turning base and ship canal. Several storm water outfalls which have the potential to discharge to these waters are also covered by this permit.

Pumps: Hydro descaling pumps are used at the Indiana plant. Weir received an order for $2.8 million for Warman slurry pumps for tailings transfer at Krivoy, Ukraine.

Sedimentation/Centrifugation: Dawco installed a 43m diameter thickener, a 25m diameter water tank, a pump house building and a piperack that connects to the concentrator sector of the Mount Wright Iron Mining Complex in Fermont, Québec.

Monitoring: CiDRA SONARtrac® Process Monitoring Technology is used for product transfer measurement on a 27 km hydrotransport slurry pipeline in Mexico that runs from nearby mines to steel plant in Lázaro Cárdenas City, Michoacán. A high pressure pump injects the slurry into the steel pipeline for the 27 km transit to the pelletizer plant.

Valves: ArcelorMittal Tubarão (formerly CST-Arcelor) Brazil, had Life Cycle contracts with Metso for all automated control, manual and safety valves throughout the ArcelorMittal Tubarão’s plant in Serra City. The total is almost 40,000 valves and included over 700 control valves.

In 2015, ArcelorMittal Tubarão, awarded SGS a four-year contract for the maintenance of security and control valves. A specialist team of 30 experts will detect the type of maintenance required for each valve. Valves will then be removed, opened, serviced and reinstalled. If major repairs are required, the valve will be taken to the dedicated SGS workshop in the city of Serra.

OEM Networking Directory Has the Contacts at Consulting and Supplier Companies

If you sell systems, scrubbers nozzles, packing or corrosion resistant materials you will use the McIlvaine OEM Networking Directory daily. Check it out at: 53DI OEM Networking Directory.

Huaneng Bayanbaolige 1,320 MW proposed Coal-fired Power Plant in Inner Mongolia Autonomous Region, China

§ Seventeen Power Plant Owners have Purchased 56 Percent of all the World’s FGD Systems

§ Carbonxt and United Conveyor Corporation launch Joint Air Quality Control Offering

§ Precipitators can compete with Fabric Filters – Hot Topic Hour Thursday October 22, 2015Upcoming Hot Topic Hours

The Utility E-Alert is issued weekly and covers the coal-fired projects, regulations and other information important to the suppliers. It is $950/yr. but is included in the $3020 Utility Tracking System which has data on every plant and project plus networking directories and many other features.

State by State Forecasts Needed by Suppliers of Flow Control and Treatment Products and Services

The market for flow control and treatment (N064 Air/Gas/Water/Fluid Treatment and Control: World Market) will be over $350 billion this year. The market has been segmented into 80 countries and sub regions. Some of the smaller countries account for less than 0.1 percent of the total. By contrast, California accounts for 2 percent of the total, so international suppliers need to segment the U.S. by region and, in many cases, by State. This is accomplished in a supplemental report, Analysis & Forecast by Industry & State.

The food segment provides an example. The U.S. flow control and treatment in the food industry represents more than 22 percent of the world total. Expensive pumps and valves are needed to meet the sanitary requirements of food processors. Cross-flow membranes not only provide high purity water and clean wastewater but are concentrating liquids such as juices and corn syrups. Fabric filters are used not only for air pollution control but to capture product in hot gas streams e.g. coffee spray driers.

The U.S. will purchase two hundred and twenty times more food flow control and treatment products and services than Guatemala this year.

FOOD INDUSTRY(%s) BASE YEAR 2014
	2014	2015	2016	2017	2018	2019	2020	2021
United States	21.80	22.30	22.82	23.36	23.92	24.50	25.09	25.69
Canada	1.95	1.98	2.02	2.06	2.09	2.13	2.18	2.22
Mexico	2.39	2.49	2.61	2.73	2.87	3.01	3.17	3.35
Argentina	0.98	1.01	1.04	1.07	1.10	1.13	1.17	1.20
Brazil	3.11	3.17	3.23	3.30	3.36	3.43	3.51	3.59
Chile	0.44	0.45	0.47	0.48	0.50	0.52	0.54	0.56
Colombia	0.69	0.72	0.76	0.79	0.83	0.86	0.90	0.94
Ecuador	0.21	0.22	0.23	0.23	0.24	0.26	0.27	0.28
Guatemala	0.11	0.11	0.11	0.12	0.12	0.13	0.13	0.14

The state analysis segments each industry by state and aggregates it into nine regions. California represents 10 percent of the U.S. food industry flow control and treatment market while the Pacific states account for more than 14 percent.

FIGURE I-2B: U.S. Food Industry - Percent of U.S. 2014 Total
STATE	2014	2015	2016	2017	2018	2019	2029	2021
Alaska	0.32	0.33	0.35	0.36	0.37	0.39	0.40	0.42
California	10.26	10.67	11.10	11.54	12.00	12.48	12.98	13.50
Hawaii	0.22	0.23	0.24	0.25	0.26	0.27	0.28	0.29
Oregon	1.21	1.26	1.31	1.36	1.42	1.47	1.53	1.59
Washington	2.08	2.16	2.25	2.34	2.43	2.53	2.63	2.74
TOTAL Pacific States	14.09	14.65	15.24	15.85	16.48	17.14	17.83	18.54

McIlvaine continues to adjust forecasts based on a number of its own reports plus U.S. census data such as the number of employees in each facility in each industry.

300 Large Oil and Gas Projects Account For 80 Percent of the Flow Control and Treatment Purchases

Some oil and gas projects include hundreds of millions of dollars of pumps, valves, filters, compressors and other flow control and treatment equipment. The top 300 projects each year account for more than 80 percent of the purchases. McIlvaine tracks these in the bi-weekly Oil, Gas, Shale, Refining E-Alert.

October 30 Oil and Gas E Alert covering two week period
Project Name	Description	Total Amount $ Millions	Flow Control Treat $ Millions	Order Yr 20+
Enbridge	Canadian pipeline	38,000	300	16-19
Odebrecht	Pipeline in Peru	4,000	40	17-19
Golar	FLNG off Cameroon	8,000	90	17
Saudi Arabia's PetroRabigh	Petrochemical and refining complexes	10,000	200	16-18
Dung Quat Refinery	New refinery in Vietnam	4,000	90	16
Rosneft	New refining and petrochemical complexes in Eastern Russia	10.000	200	17-19
10 additional large projects	LNG, refining, extraction	50,000	1,000	16-19
Total		124,000	1,920

Sixteen projects reported in the latest bi-weekly issue account for close to $2 billion of purchases of flow control and treatment equipment. The scope includes oil and gas extraction, LNG, gas-to-liquids processing, and tar sands processing.

NAICS	Alabama Food manufacturing facilities--- # of employees	25	50	200	300	500
3111	Animal Food Manufacturing	39	20	16	3	0
3112	Grain and Oilseed Milling	8	2	4	2	0
3113	Sugar and Confectionery Product Manufacturing	14	13	1	0	0
3114	Fruit and Vegetable Preserving and Specialty Food Manufacturing	8	6	1	0	1
3115	Dairy Product Manufacturing	8	4	1	3	0
3116	Animal Slaughtering and Processing	79	34	9	16	20
3117	Seafood Product Preparation and Packaging	22	9	9	4	0
3118	Bakeries and Tortilla Manufacturing	74	61	9	4	0
3119	Other Food Manufacturing	26	11	8	6	1
3121	Beverage Manufacturing	43	37	2	4	0