080619 MF ECHO GB J08 RZ+ · printing systems sector, in April MAN Ferrostaal Australia also...

THE ECHOTHE MAGAZINE OF THE MAN FERROSTAAL GROUP

ECOLOGICALThe sustainable production of biofuels

JUNE 2008

REFRESHINGSolar cooling for hotels, building com-plexes and industry

PROMISINGThe awakening economic centre of South Africa

A plant for solar cooling on the roof of a Metro market in Antalya, Turkey

Cover picture: a blossoming field of sugar cane

3THE ECHO June 2008

Editorial

Dr. jur. Matthias Mitscherlich, Chief Executive Officer of MAN Ferrostaal AG

Climate change and secure energy supply are central top-ics of our century. They are the drivers of increasing de-mand for renewables and biofuels. As a result, new mar-kets develop in which mainly small and medium-sized enterprises have so far been active. But large volumes and industrial structures are necessary to achieve a widespread effect. With our know-how as a successful project devel-oper and project manager in large plant construction, we form a bridge between young, creative but small technol-ogy providers of renewables and other partners who wish to enter this market.

The basis for this is our fascinating business model which we have been using for a long time in our established busi-ness fields – for example the petrochemical industry – and which can be transferred to our new Solar and Biofuels busi-ness segments. With this business model we ensure that the partners who are best suited for implementing a large indus-trial project work together and that complex technical and commercial procedures function without a hitch. Project development, project financing and project management – sometimes through to the marketing of the products pro-duced – are therefore in our experienced hands. Reliability, mutual respect and trust are the values on which we build here. Our partners from Oman to Trinidad and South Africa know that these are not merely empty words.

A visible sign of this trust is provided, for example, by the fact that MAN Ferrostaal was the first company in South Africa to fulfil offset obligations amounting to three bil-lion euros. With its services MAN Ferrostaal created over 20,000 jobs in this country and is still promoting the es-tablishment of a flourishing industry, for example with a fund for young companies. We use the market knowledge which we gather in this context to expand our own busi-ness, both in our established business segments and in new ones in this aspiring industrial country.

But it is not only in this region that we have set ourselves ambitious growth targets. We are also expanding our busi-ness in other promising regions in which we have for decades been represented by activities of the Services division – in particular with regard to the new Biofuels and Solar business segments. The good business results in recent years give us the strength required for this task and for a rap-id growth in sales in the coming years. We are preparing the ground for this – it is an exciting time for our company.

We hope this edition of THE ECHO will prove to be an in-teresting read.

Yours truly,

Matthias Mitscherlich

Dear Readers,

CoNtENtS

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ProjECtSGetting the future rollingBiofuels are a growth market. But only those biofuel activities will succeed which do not compete with food, do not pollute the environment and do not lead to destruction of the rainforest. The future belongs to the biofuels of the second generation.

ProjECtSHere comes the sun …Free energy, day after day and completely free of CO2. It just has to be used: for the generation of power, process heat and cold. Together with its technology partners, MAN Ferrostaal is also active in this future market.

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NEWSCompany news from around the globe: from the Middle East, on new MAN Houses in Moscow and Mumbai, about consolidation in the growth market Australia, on tugs in action on the seas around the world, and about MAN Ferrostaal as an attractive em-ployer for graduates from any country.

ForumOn the way to further growthWith a healthy mixture of tried-and-tested and new technologies the company is evolving into one of the world’s leading developers and managers of large plant projects.

Pipelines for the petrochemical industrySchmidt + Clemens is a long-standing partner of MAN Ferrostaal for supplying spun-cast pipes and fittings.

ProjECtSMilestOnes in PicturesMethanol to fuel an economic upturn A success story in eight pictures.

From the top down In Sepetiba, Brazil, a new steelworks is under construc-tion. Two gigantic gas holders, each with a usable vol-ume of 100,000 cubic metres, are being constructed by MAN Ferrostaal.

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THE ECHO June 2008 5

SErviCES“We want to continue growing”The business unit Piping Supply is one of the market leaders in Germany and the Benelux countries. But the two heads of the business unit are not content just with this and have an eye on other regions.

strengthening the market position in ArgentinaMAN Ferrostaal has made a name for itself in many countries in the world by marketing manroland sheet-fed offset printing systems. In Argentina it also suc-cessfully markets the smaller Ryobi models, which are particularly popular with medium-sized enterprises.

coining machines for Olympic medalsMAN Ferrostaal has been successful in the field of coinage for many years, and supplies China with coi-ning presses for common coinage and collectors’ and commemorative coins – and also for producing the Olympic medals.

CouNtriES aNd PEoPlEAn entrepreneur in the enterprise A portrait of Erwin Keutner, Head of the business unit Petrochemical Industry, who for years has been setting a worldwide example with an extremely suc-cessful business model.

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cOuntrY sPeciAl: sOutH AFricA Venture capital fund for south African start-upsFinance to support young South African enterprises as they bring their products to the global technology market.

Participating in growthSouth Africa is an interesting market, for example, in the field of renewables. Sean De Lancey, Managing Di-rector of MAN Ferrostaal in South Africa, explains his strategies.

Market leader in roll-fed printingThe development of a country is also indicated by increasing levels of education and thus by rising numbers of newspaper readers.

Quick business etiquette guide for south AfricaThe most important basics for real success when deal-ing with South African business partners in Cape Town, Durban, or Johannesburg.

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The sight of the brightly packed presents shortly be-fore Christmas made the hearts of many children in

the small Caribbean town of Morón beat faster. Each of the approximately 600 four- to eight-year-olds received a new toy car, play figures or a doll when the presents were handed over in the morning. As about one third of the chil-dren in the community do not have the opportunity to go to school, the presents were not only distributed at two schools but also on two squares in the town.

With the support of the town council, MAN Ferrostaal and its partners VEC and Toyo Engineering Corporation orga-nised this handing out of presents so that it could also become socially involved on site. The company and its part-ners are currently replacing a fertiliser factory there.

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Venezuela:Christmas wishes come true

NEWS

The presence of MAN Ferrostaal at the World Future Energy Summit

2008 in Abu Dhabi, Power-Gen in Bah-rain and Gulfood in Dubai at the start of the year underlines how important this region is for the company. MAN Ferrostaal used its appearance at the Abu Dhabi summit as MAN Solar Millennium and also the joint appear-ance with MAN Diesel in Bahrain as well as its individual presentation in Dubai to show the specialist visitors its potential in the fields of solar ener-gy, power generation, and in the food and packaging industries.

The World Future Energy Summit is the largest trade fair for renewables

and sustainability in the region. This year 180 international exhibitors and top-class guest speakers from the fields of politics and economics were present. Power-Gen attracted 120 ex-hibitors from 50 countries and at least

3,000 specialists from the power gen-eration sector. The Gulfood fair, which has existed since 1987, is the largest and most important food industry trade fair in the Middle East.

Represented at the major trade fairs in the Middle East

Children in Morón with their gifts

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MAN Houses opened in Moscow and Mumbai

THE ECHO June 2008

Facade of the MAN House in Moscow

The new branch of the MAN Group in Mumbai

Gorky Park

Bolshoi Theatre

MAN House

Tretyakov Gallery

Zoo

Mos

kva

Kremlin, Red Square

Central Museum of the Revolution

Moscow

Mumbai

Haji Ali Tomb

Jain Temple

University of Mumbai

Mumbai Race Course

Elephant Island

Victoria Terminus

M U M B A I C E N T R A l

Hanging Garden

Juhu Beach

MAN House

ArabianSea

The opening of two more MAN Houses in Moscow on April 16 and in Mumbai on May 9, 2008, means that

the strengths of the MAN subgroups in Russia and India will also be concentrated to offer customers even better access to the products and services of the MAN Group.

Around 30 employees in Mumbai and 40 in Moscow will control the company’s activities, focusing on the trans-port and power engineering segments. In Russia the MAN Group can look back on economic relations dating back to

1867 – the longest of our foreign relationships. MAN has been active in India since 1902.

In the last two years, MAN Houses have been opened in Mexico, Beijing, Dubai, Lima, Jakarta and Kuala Lumpur. These are now followed by the two locations in Moscow and Mumbai, in regions where the economy is booming. The establishment of the MAN Houses is being coordina-ted by MAN Ferrostaal in the context of the internationa-lization strategy of the MAN Group.

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Consolidation in the growth market Australia

Australia’s economy is growing, and MAN Ferrostaal is growing

with it. By taking over 70 percent of the shares at the start of this year in Industrial Plant & Service Australia (IPS), which has its headquarters in Sydney, the company has expanded its machine and plant business “down under”. IPS specialises in the rotat-ing machines sector, in particular in turbines and compressors, and also equipment for the metal working industry. It has also for many years provided services as a representative

of MAN Turbo, a sister company of MAN Ferrostaal. In order to cater bet-ter for Australian customers in the printing systems sector, in April MAN Ferrostaal Australia also launched a joint venture with manroland in which each partner has a share of 50 percent. With its 15 employees it will provide a competence centre for ser-vice and maintenance in the newspa-per rotation sector and consequently an ideal service. The joint venture is also based in Sydney.

Steel is in great demand in Vietnam: estimates of the German Office for Foreign Trade (bfai) forecast an an-

nual demand of eleven million tonnes by 2010. An increase in the domestic production capacities will go hand in hand with this boom. The state-owned shipbuilding company Vinashin is constructing a new hot rolling mill in Cai Lan in North Vietnam. MAN Ferrostaal is providing the project management team for this project. The land on which the plant is being built was reclaimed from the sea just a few years ago. 90 percent of the foundations for the buildings and machines have now been completed, with all of them standing on concrete piles. “These are some of the largest

foundations that have ever been built in Vietnam,” says Project Manager Wilhelm Bruckmann. “The assembly of the steel construction halls is in full swing, and we’ll soon start setting up the mechanical equipment,” he adds. The two rolling mill stands of the platemill each weigh 200 tonnes. Vietnamese companies are constructing the foun-dations and halls, while Chinese manufacturers supplied the rolling mill machines. The rolling mill will initially have an annual capacity of 350,000 tonnes, and once it has been completed will produce shipbuilding plate which is from five to 50 millimetres thick.

New territory for Vinashin

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IPS Managing Director Erich Roth (l.) hands the shares to Dr. Claus Herting, Vice President Equipment Solutions at MAN FerrostaalAUSTRAlIA

Q U E E N S l A N D

Canberra

N E w S o U T H w A l E S

V I C T o R I A

T A S M A N I A

Brisbane

Hobart

Cairns

Sydney

A U S T R A l I A N C A P I T A l

T E R R I T o R yMelbourne

South Pacific

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Strong performance: in early February the anchor han-dling tug “Janus” managed to rescue a heavily-laden spe-

cial cargo ship. Heavy gusts of wind had caused the Chinese vessel “Zhen Hua 10”, with five gantry cranes on board, to run aground off the Dutch city of Rotterdam. The efforts of the Rotterdam coastguard to refloat the ship were unsuc-

cessful. The powerhouse which is “Janus” succeeded in do-ing so at the first attempt. “Janus” is the newest of the five ocean-going tugs which MAN Ferrostaal built together with Mützelfeldtwerft. The ship has a tractive force of 219 tonnes and belongs to the Hamburg company Harms Bergung.

“Janus” proves her value

AHT “Janus” (l.) towing the “Zhen Hua 10” free

9THE ECHO June 2008

In conjunction with Grenzebach BSH, MAN Ferrostaal has built a

gypsum and gypsum plasterboard plant in Tecomán, Mexico. The cus-tomer, US Gypsum, for whom the Es-sen-based company has already built two other plants, accepted the plant in July 2007. The factory can produce around 24 million square metres of gypsum plasterboard per year. Natu-ral gypsum from the nearby mines is processed to produce this plaster-

board: first it is broken up and ground, and then it is calcined (the water is re-moved by heating). The plant is con-nected to the local infrastructure by its own railway line and a newly built road which is three kilometres long. It is the seventh gypsum and gyp-sum plasterboard plant constructed jointly by MAN Ferrostaal and Gren-zebach BSH around the world. It took 13 months to build.

Gypsum plant in Mexico

The plant in Tecomán is the third gypsum plaster-board factory which MAN Ferrostaal and Grenze-bach BSH have constructed for US Gypsum.

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NEWS

In the nationwide study “Top Em-ployers for Engineers” (Top-Arbeit-

geber für Ingenieure), MAN AG was ranked second in the “International-ity” and “Development Opportuni-ties” categories.

Production facilities, marketing and development locations and opportu-nities for international deployment were assessed in the “Internationality” category. The decisive criteria for “De-velopment Opportunities” included

the career launch and support pro-grammes for engineers, systematic measuring of potential and strategic succession planning. MAN was also rated highly in the “Work/Life Balance” category. The renowned Corporate Re-search Foundation (CRF) conducted the study in Germany with 25 well-known companies from a wide range of industries. The participating com-panies included Continental, RWE, Siemens and Webasto.

Young, dedicated and flexible people have many opportunities to start

their careers at MAN Ferrostaal and also to extend and consolidate their theoretical knowledge with practical experience. The company is always looking for working students and in-terns for its various business and serv-ice units. Each year 20 trainees who have completed their degrees in the fields of economics and technology are taken on. Interns, working students and trainees who work at MAN Ferrostaal particularly appreciate the experience abroad which they are frequently able to gain after just a very brief training

period, and also the company’s diver-sification and innovative power. They are able to get to know a large number of different industries and to comple-ment their knowledge of promising new technologies.

They also find the extensive opportu-nities for further training – such as seminars, language courses and DP courses – and the long-term national and international prospects particular-ly attractive. MAN Ferrostaal was awarded the “Fair Company” quality seal in March 2007. This initiative was launched by the magazine Junge

Karriere (Young Career) to combat un-fair employment of highly motivated graduates and interns who have al-ready completed their degrees.

“Top Employers for Engineers”

Getting started during and after a degree course

More information, job ads and brochures are available on the Internet: www.manferrostaal.com

11THE ECHO June 2008

“Ursus” means “bear” in Latin. And the ocean-going and anchor-handling tug of the same name which

was christened in Cuxhaven in late April is as strong as a bear. The seaworthiness and towing tests off the Norwegian coast that preceded the christening were very successful. The ship was built by Mützelfeldwerft in conjunction with MAN Ferrostaal and achieves a bollard pull of 220 tonnes and an engine performance of around 14,000 kilowatts. Thanks to the oil boom in the offshore sector there is a great demand for special ships of this kind. Dynamic posi-tioning enables the tug to be brought to the required position and kept there for a lengthy period of time. The “Ursus” also has fire monitors which can discharge 1,200 cubic meters of water per minute a distance of 135 metres and 45 metres into the air. The 1,600-metre towing cable is approximately eight centimetres in diameter and is supplemented by an 800-metre working cable. The ship is designed for heavy oil operation.

The owner of this powerhouse which sails under the flag of Antigua and Barbuda is the Hamburg shipping company Harms Bergung. The crew of 16 consists mainly of sailors

from Russia and the Ukraine. The tug has an overall length of 65 metres, a beam of 18 metres and a draught of 6.8 me-tres. The “Ursus” is the sister ship of the “Janus”, which towed a Chinese special cargo ship back into open water after it had run aground off the Dutch coast in February (page 9).

The shells of the next two vessels, “Uranus” and “Pegasus”, are already moored to the wharf. With an overall length of 75 metres the “Uranus” is ten metres longer than the “Ursus”. Its towing capacity of 280 tonnes also means it will be considerably more powerful and is designed to set new performance records.

MAN Ferrostaal maintained the positive development of the

previous year. Sales rose to a record level of 1,445 million euros (previous year: € 1,379 mill.), while the earnings before interest and taxes improved to 179 million euros (previous year: €119 mill.). This means a growth of 50 per-cent compared to the previous year, which was also the result of the posi-tive development in the investments in methanol and ammonia plants. Incoming orders amounted to 1,556

million euros (previous year: €1,982 mill.), once again above the current turnover. The orders on hand rose by three percent compared to the previ-ous year to 2,415 million euros (pre-vious year: €2,342 mill.). The return on sales increased significantly to 12.4 percent (previous year: 8.6 per-cent); the return on capital employed (ROCE) rose to 36.9 percent (previous year: 31.2 percent). The number of em-ployees dropped slightly from 4,290 at the end of 2006 to 4,237.

Sea bear with a lot of pulling power

Business result 2007: successful trend continued

The headquarters of MAN Ferrostaal AG in Essen

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Facts and figures

MAN Ferrostaal transactions from 2005 to the present

Share

Year Transaction Name of the company Currently Previously

2005 Addition Founded LMG Logistiek Magazijn Gent BVBA 100% -

Founded SCA Service Center Antwerpen N.V. 100% -

2006 Addition Purchased Eurotecnica Melamine S.A., Luxembourg 34% -

Purchased KSH Solutions Inc., Canada 22% -

Share sold DSD Steel Group GmbH (– 51%) 49% 100%

2007 Addition Founded MAN Solar Millennium GmbH 50% -

Founded MAN Solar Millennium LLC, USA 50% -

Founded MAN Middle East FZCO, Dubai 50% -

Founded MAN Ferrostaal Inc. (non-steel business) 100% -

Purchased Koch de Portugal Serv. de Eng. e Com. Industrial, Lda. 100% -

Purchased Solar Power Group GmbH 25% -

Purchased SOLITEM GmbH 20.1% -

Outsourced Sold Ferrostaal Metals Group GmbH (– 66.6%) 33.3% 100%

Sold MAN Ltd. (– 25% +1share) 49.99% 75%

Sold DSD Steel Group GmbH (– 49% ) - 49%

60 countries: MAN Ferrostaal has been present around the world for many years.

on the way to further growthFor some years now MAN Ferrostaal has been evolving from a business enterprise into an industry service provider. The aim is to grow the com-pany into one of the world’s leading developers and managers of indus-trial projects involving large plants in its core areas of activity – with a healthy mixture of both tried-and-tested and new technologies.

13THE ECHO JUNE 2008

The Essen-based company focuses its business on energy and fuels. In the course of the strategic re-orientation last year the Solar and Biofuels busi-

ness segments were added to the traditional Petrochemi-cals and Industrial Projects business segments. MAN Ferrostaal has concentrated its business on these areas for about three years and has in the meantime conducted various transactions in this field. In order to be as well or-ganised as possible for the activities in the new business segments, the company obtains trend-setting technolo-gies by acquiring shares in, cooperating with and taking over other companies.

In the new Solar business segment, for example, the com-pany invested in three technology providers in 2007. In a joint venture with Solar Millennium AG, MAN Ferrostaal is working with the aim of establishing itself as the leading provider of solarthermal power plants in the world. Each company owns 50 percent. A second technology partner is the Solar Power Group, which develops power plants based on Fresnel technology. MAN Ferrostaal also has a 20.1 per-cent share in the SOLITEM Group from Aachen. The two companies jointly market plants for solar cooling.

MAN Ferrostaal was able to strengthen its competences in plant construction both for the traditional Petrochemicals and Industrial Projects business segments and for the new business segments by purchasing Koch de Portugal. Koch de Portugal specialises in planning and handling large industrial projects. MAN Ferrostaal bought a 34 percent share in Eurotecnica, a company which develops plants for producing melamine and other special chemicals around the world. The company has had a 22 percent share in the Canadian company KSH Solutions Inc. since 2006. KSH Solutions Inc. is active in the field of pulp and paper (con-struction of pulp mills), a sector in which MAN Ferrostaal also wants to expand. Further important company launch-es by MAN Ferrostaal include LMG Logistik Magazijn Gent BVBA and SCA Service Center Antwerpen N.V. – both in the automotive sector.

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SERIES Long-term “first-class partners”

Special steel works Schmidt + Clemens

Project development and project management are core competences of MAN Ferrostaal. This applies equally for the Projects and Services divi-sions. As a general contractor and industry service provider the business divisions has many contacts and the knowledge of who is best suited for which task. One great advantage for the customer here is the company’s independence from suppliers. It frequently brings over 100 different part-ners together when large industrial plants are constructed – some as one-off suppliers, others for the duration of a project. MAN Ferrostaal has been working together with a carefully selected group of partners for many years. These long-standing partnerships are presented in this series. This time the focus is on a partner in the Piping Supply business unit who has also sup-plied spun-cast pipes for ammonia and methanol plants: the special steel works Schmidt + Clemens.

Coiled pipes for ethylene crackers at furnace temperatures of up to 1,200 degrees Celsius


Pipelines for the petrochemical industryIn the Piping Supply business segment MAN Ferrostaal has for many years cooperated with renowned manufacturers. Since November 2003, it has also represented the Schmidt + Clemens Group (S+C), the market leader in the sector of spun-cast pipes for the petrochemical industry. S+C produces spun- and static-cast components for the petrochemical sector and direct reduction plants at six sites worldwide.

The world of S+C is that of high temperatures, in other words, of over 1,000 degrees Celsius. Such tempera-tures are encountered in certain types of plant in

the petrochemical sector, the so-called steam crackers and steam reformers. However, S+C does not only supply spun-cast pipes and static-cast fittings, but also complete, ready-to-install cracker coils and reformer piping systems.

The sales agreement is based on exclusivity and applies for all the CIS countries and Poland. Last business year, the busi-ness volume in the contract territories was expanded to the record level of over 15 million euros.

In addition to the marketing cooperation in the Piping Sup-ply business unit, S+C also supplied spun-cast pipes for some of the ammonia and methanol plants constructed by MAN Ferrostaal and for the direct reduction plant in Lebed-insky Gok (Russia). S+C’s product range ideally complements the standard range offered by the Piping Supply business unit. Not only can the demand for piping made of C steel, alloyed materials and stainless steel (temperature range ~ 700 degrees Celsius) be

catered for, but also the high-temperature sector. The syn-ergy effects have led to an appreciable growth in business for both product areas, in particular on the Russian market which, together with Central Asia, has now become the busi-ness unit’s most important single market.

From the very outset MAN Ferrostaal was forceful in its marketing and visited a large number of customers and potential customers with employees from the foreign sub-sidiaries.

The clientele includes well-known Eastern European oil and gas companies such as Orlen and Sibur (a Gazprom subsidi-ary). The strongest relationship is with LUKOIL. The plants in Perm and Budennovsk (Russia), Petrotel (Rumania) and LUKOR Kalush (Ukraine) are also customers. Further ma-jor contracts have been signed with plants in the Ukraine, Russia and Georgia. Recently a contract was also signed for the delivery of 90 pre-heater coils for the direct reduction plant LebGOK in Russia.

(More information on the Piping Supply business unit is provided on pages 58ff.)

Schön, daß Sie neugierig reinschauen, obwohl hier ja eigentlich noch gar kein richtiger Text steht, sondern nur der sogenannte Blindtext. Der aber soll Ihnen

diesmal mehr Spaß machen als das „Eiriseididum“ oder das „Kisuaheli omryx nomryx“ oder dieses „Iam quanto minoris constat haec felicitas accessio!“ oder „In general, bodytypes are measured in the typographical point size“. Dieser Blindtext will Ihnen nämlich dreierlei sagen: Erstens will er den Texter entschuldigen – tut uns leid, aber es war einfach unmöglich, das Ding gestern nacht noch exakt auf Länge runterzuschreiben. Das Briefing, Sie wissen schon. Schwieriges Thema. Und die Freundin ist krank, und der Freund wollte unbedingt in diesen neuen Film. Also sorry. Ja, und zweitens haben wir Sie bis hierhin zum Lesen ge-bracht und wollen damit belegen, daß nicht alle Marktfor-scher und Kaffeesatzleser recht haben, die sagen, daß unser armer Freund Otto Normalverbraucher und seine häßliche Schwester Lieschen Müller maximal Null Komma gar kein Interesse haben für Texte.

Drittens sollten wir für ein paar Zeilen abschweifen und uns dem Gegenstand unserer Bemühungen zuwen-

den. Was heißt überhaupt Blindtext? Macht er blind, und wenn ja, wen? Die Grafiker und Typografen, die solange blind in die Tasten hauen, bis ein Schreiber die Zeilen mit Sinn füllt? Ich denke, das Wörtchen will uns ja auch nur warnend darauf hinweisen, daß viel zu oft nach dem Motto

„Augen zu und durch“ verfahren wird bei der verantwor-tungsvollen Aufgabe, Grauwert zu verteilen. Ja sapperlot, sagen Sie jetzt vielleicht (wenn der Layouter den Text bis hierhin aus formalen Gründen noch nicht abgeschnitten hat), man soll doch in einem Layout nur sehen können, wie das Schriftbild überhaupt aussieht: Welche Schrift haben wir denn, in welcher Größe, wie sind die Buchstabenab-stände und so weiter (Form follows function?). Trotzdem: Vielleicht ist ja die aktuelle, zeitgeistige und allgemei-ne Mißachtung interessanter, unterhaltsamer und aus-schweifender Betrachtungen genau darin zu suchen, daß sie präsentiert wird erst mal in Form von Blindtext, also Blödsinnstext. (Siehe oben.)

Nichts über Ihr Produkt, nichts über Ihre Leistungen, nichts über Ihren Service, nichts über Ihre tollen Leute. Nichts über Ihr Angebot, nichts über Ihren Stolz, nichts über Ihr Engagement, nichts über Ihren Optimismus. Wäre doch schade, oder? Für den Fall, daß Sie jetzt der Meinung sind, es gäbe über Ihre Sache ja gar nicht so viel zu sagen, gibt es diese alte Werberegel als Trost und Ansporn: Wenn Sie wirklich nichts zu sagen haben, dann sagen Sie das wenigs-tens lustig. So, genug jetzt: Die durchschnittliche klassische Käfer-Anzeige hatte 632 Anschläge, und wir sind schon weit drüber. Warten Sie mal ab, wie schön der Text ist, der später hier gedruckt wird. Viel Spaß beim Lesen!

HeadlineSchön, daß Sie neugierig reinschauen, obwohl hier ja eigentlich noch gar kein richtiger Text steht, sondern nur der sogenannte Blindtext. Der aber soll Ihnen diesmal mehr Spaß machen als das „Eiriseididum“ oder das „Kisuaheli omryx nomryx“ oder dieses „Iam quanto minoris constat haec felicitas accessio!“ oder „In general, bodytypes are measured in the typo-graphical point size“.

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ProjECtS

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Getting the future rolling


Biofuels are a market with a future – for technology providers, for sup-pliers of plant components and for industrial agriculture. At the centre of MAn Ferrostaal’s biofuel activities is the theme of sustainability. this means no competition with food crops, no destruction of the rainforest and no pollution of the environment by its plants. in April 2008, MAn Ferrostaal handed over its first turnkey biodiesel plant to a customer. this means it already has a successful presence in this growth market.








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MAN Ferrostaal forms partnerships for entry to the market with biofuels.¹ Operation and maintenance; ² Engineering, Procurement & Construction; ³ Supply plants and operation; 4 Special purpose company

Local feedstock supplier

· Land provision and operational management (agriculture, change of use)

· Obtains access to finances/offset

· Capital procure-ment and project integration

· Provision of EPC services

MAN Ferrostaal

· Operation· Maintenance

Purchaser

· Offers purchase contract

· Outsourcing of project develop-ment to partner firms

O&M¹

Local feedstock supplier

MAN Ferrostaal (minority

share)

PurchaserStrategic investor

Strategic investor

· Entrepreneurship and representation

The main partners for biofuel production join together to form a

special purpose company

Special purpose company/SPC

The best partner model comprises seven project development steps:

Feedstock identification and acquisition

Signing of a confidentiality agreement with all main partners (core development)

Preparation of the project development agreement

Feasibility study, technical + commercial (active development)

SPC4 formation and early integration of finance partners in the evaluation process

Definition of time frame, milestones and budgets

Financing concluded

EPC²

E, P C U/O³

ProjECtS

19DAS ECHO Dezember 2007

“our principle for success is the business model”

How do you assess the growth potential of biofuels? REIMELT: Biofuels have great potential for the future. By the year 2030, an estimated additional 680 billion litres of fuel will be needed for passenger and goods transport alone. That is a massive demand, which can only be satisfied by a sen-sible energy mix. Biofuels will therefore take a considerable share of the fuel market in future.

BETTNER: On top of that, of course, comes the increased awareness of the environment, which is driving the market forward at a rapid pace. The Kyoto Protocol, to take one ex-ample, stipulates an average reduction in annual greenhouse gas emissions by the industrialised countries of 5.2 percent by 2012. Similar goals have also been set by the European Union. In addition, more and more states are making an ef-fort to achieve a certain degree of independence from the oil suppliers. Biofuels will play a very important role here.

Enormous growth potential is predicted for biofuels – but the market is not without risks. The success of a biofuel project is crucially dependent on the economic concept and on a partner who possesses the necessary know-how in all relevant stages of the project. Dr. Stephan Reimelt, Member of the Ex-ecutive Board and Head of the business segment Biofuels and Project Devel-opment, and Jürgen Bettner, Head of the business unit Biofuels, have ana-lysed the market intensively in recent months. In this interview, they report on market opportunities and the special nature of their business model.

THE ECHO June 2008

Fuel mix in Europe: Vision 2030Less than 40 percent of fuels will be based on mineral oil.

Others (Biodiesel, Bioethanol)

Sunfuel, biomass-based

Oil-basedSulphur fraction < 500 ppm

Oil-basedSulphur fraction < 10 ppm

Synfuel, natural gas-based

Hydrogen, regenerative~4%

~35%

~38%

~23%

2000 10 20 30Years

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What know-how does MAn Ferrostaal possess for bio-fuel projects?REIMELT: MAN Ferrostaal possesses very well-trained per-sonnel and know-how in the crucial areas. Project devel-opment, project management and project financing are the fundamental factors behind our success. We also have

relevant technologies for the production of bioethanol and biodiesel.

Our decisive advantage is that we are not bound to indi-vidual manufacturers or processes. We develop the whole project jointly with our partners. Our services here cover

the whole process – from the planning to the financing and the turnkey handover. That distinguishes us fundamental-ly from our competitors.

For biofuels, in addition to our tailor-made solutions, we can also provide further parts of the value added chain if required. In this case, we act as our own engineering part-ner. Most important in all cases, however, is the commer-cial concept. That must be right if plants are to operate with long-term success.

BETTNER: We have built up a powerful team for the devel-opment of biofuel projects – also in Brazil, our focus region – and we have many years of experience in the construc-tion of biodiesel and edible oil plants. We also work with

our own processes in both areas. For example, we possess a worldwide licence for the so-called Connemann process,

Jürgen Bettner, Head of the business unit Biofuels

Jatropha, also known as the physic nut, is a shrub from the euphorbia family, which will play a major role in the future production of biofuels.

“we develop the whole project jointly with our partners. our services here cover the whole process – from the planning to the financing and the turnkey handover. That distinguishes us fundamentally from our competitors.”

which has now become widely established. We have been active for over 35 years in the edible oils sector and have un-dertaken the engineering for about 100 plants worldwide. Here, refining is one of our core services.

Which raw materials does MAn Ferrostaal concentrate on?BETTNER: There is a whole range of raw materials suitable for the manufacture of biofuels. However, biofuels cannot be economically and ethically manufactured with every raw material. That is why we have conducted an intensive analysis in more than 200 countries throughout the world to find out which raw materials are best suited for which countries. Here we deliberately distance ourselves from starch-based raw materials such as wheat and maize.

In the bioethanol area, we concentrate primarily on sugar-based raw materials: more specifically, these are sugar cane and sorghum millet, a grass mainly cultivated in Africa, Central America and South East Asia – and on cassava as a starch-based raw material. These raw materials promise a good cost and greenhouse gas balance and they are not in direct competition with the food chain. In the biodiesel area, we concentrate on rape, soya and waste oil.

REIMELT: Jatropha will also play an important role in the future. Here, we are already conducting preliminary dis-cussions with potential customers. And, of course, the “second generation” theme is very important and will be increasingly incorporated in our future strategy.

Which markets does MAn Ferrostaal concentrate on? And what know-how does the company possess in these markets?BETTNER: Our core markets, apart from South America and South East Asia, are mainly countries which fulfil the industrial and climatic conditions for successful biofuel production. We have been present in these markets for de-cades, so we possess a very good local network. That makes it possible for us to react quickly to changing market con-ditions. We also have a very good knowledge of the special features of these markets.

DAS ECHO Dezember 2007 21THE ECHO June 2008

Dr. Stephan Reimelt, Member of the Executive Board, manages the business segment Biofuels.

Fuel versus Food?Sufficient sustainably produced biomass can be produced worldwide to permit the manufacture of biofuels as well as a secure food supply.

1,300

2005 2020 Million tonnes per year

The biomass surplus available for biofuels represents a penetra-tion rate of approx. 50% of the total production of liquid transport fuels.

5,000

800

500

800

2,100

Biomass and crop plants cover the de-mand for foodstuffs and animal feed.

2020

Demand Supply

Biofuels

Animal feed

Food-stuffs

720

420

90

1,230

3,700

© McKinsey

22

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What does the profitability of a biofuel project depend on?BETTNER: Profitability is influenced by a series of factors. Intelligent project development, project financing and the bringing together of partners are essential criteria for suc-cess. A further factor for robust profitability is the avail-ability of cheap raw materials, as raw material costs account for over 70 percent of production costs.

REIMELT: The efficient functioning of the plant technology is only one prerequisite for a successful biofuel project. An-other is the best possible coordination of all the links in the value added chain, from the raw material to investment in a plant and sale of the biofuel produced. Another problem is that not every biofuel functions everywhere according to the same business model. So it is important to have a partner who possesses the necessary know-how in all the relevant project stages. Unlike other plant constructors, MAN Ferrostaal is an independent partner and is not tied to any individual manufacturer. For our customers, that is a crucial advantage because we are able to offer tailor-made solutions and develop 100 percent of our projects jointly with our partners.

Biofuels are dominating political discussion – and are increasingly coming in for criticism. What is your posi-tion on the subject?REIMELT: We take sustainability very seriously. This means that we do not support projects which do not meet our requirements for sustainability. What is more, ecological aspects are included right from the start in the concep-tion of our plants. We also keep an eye out for raw materi-als which do not come directly from the food production chain. With a focus on Latin America and South East Asia,

we concentrate on those countries with sufficient usable areas available to allow the production of biomass and en-ergy alongside a secure food supply.

BETTNER: And one more important point: we are dedicated to research and development and are continually exam-ining technological ideas for feasibility. Bioethanol from lignocellulose and biomass-to-liquid fuels, for example, have a great potential for the future. We shall deliberately orient our strategy to the second generation of biofuels – these not only deliver high yields, but the energy plants used as input material for our biofuels are not in competi-tion with food production.

“we take sustainability very seriously. This means that we do not support projects which do not meet our requirements for sustainability. This also applies for the environmentally friendly design of our plants.”

EUROPEAN BIOFUEL CONGRESS

MAN Ferrostaal is one of the main sponsors of this year’s EUROPEAN BIOFUEL CONGRESS in the Philharmonie in Essen on June 24 and 25, 2008.

More information at: www.dewittworld.com


MAN Ferrostaal deliberately orients its strategy to second-generation biofuels. These deliver high yields and do not compete with food production.

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Precious oilEdible oils are in demand – whether in mayonnaise, soap or highly elastic paints. For countless products, oils serve as important primary materials. This is why their consumption has risen disproportionately in past years. As an experienced plant constructor, MAN Ferrostaal has established itself in the edible oils segment – and has actually taken over market leadership in Germany for continuous deodorising plants.

Edible oils are in demand as a primary material for many products.


World production of edible oils has more than dou-bled since the Sixties. The reason for this is that, as a result of population growth and an improved

standard of living, especially in the developing and emerg-ing countries, the demand has also risen for high-quality edible oils. Added to this are new quality requirements, en-ergy awareness and higher environmental standards which demand the new construction or replacement of many ed-ible oil plants. MAN Ferrostaal has been active in the ed-ible oil sector for over 30 years. To date, the company has carried out the engineering for over 100 such plants with capacities of between 40 and 800 tonnes per day. The ser-vices provided here range from refining, in some cases with bottle production and filling, to margarine and fat manu-facture and through to general contracting.

refined technologyEdible oil is a collective term for a wide variety of different oils, mostly of vegetable origin. Therefore, different raw materials come into question for edible oil production. In addition to sunflower, rape, soya and nuts, for example, rice bran and cotton seed are also suitable. There is little difference in the manufacturing process for different raw materials and purposes. The oil is recovered from the oily fruit pulp or seeds of the plants by pressing. The raw oils obtained in this way often contain unwanted substances which have a negative effect on the flavour, the smell and the keeping qualities. Therefore, practically all oils are re-fined today. Until they are refined, they are unsuitable for human consumption. But refining is also important for the production of technical oil – for the purer an oil is, the less emissions are released when it is burnt.

The refining process is one of MAN Ferrostaal’s core ser-vices in the edible oil segment. The company has 30 years of experience in this field and has gained a considerable share of the market in Germany with this technology. The latest edible oil refinery commissioned by MAN Ferrostaal is in the Siberian city of Irkutsk. It has a daily capacity of 100 tonnes and is one of about 20 edible oil plants built by the company in Russia alone.

Widely applicableMAN Ferrostaal also applies its technology with great suc-cess in adjacent areas. The company is currently commis-sioning an oil refinery for the firm Petrotech. Petrotech has specialised in its own process for the manufacture of biodiesel from used edible fats. As certain substances, for example free fatty acids, are contained in the used edible fats, these products also have to be refined before further processing into biodiesel. MAN Ferrostaal undertook the complete detail engineering itself for the plant in Emden. The services here not only included the calculation pro-cess for and design of the individual components, MAN Ferrostaal was also responsible for deliveries, production control, assembly and commissioning of the refinery. The biodiesel fuel produced will mainly be sold on the German market, but further plants abroad are being considered.

Distillation column of an edible oil plant

26

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One technology – many productsMAN Ferrostaal’s edible oil technology can also be used without difficulty for technical oils, for the manufacturing processes are largely identical. “In future, alongside the re-fining of edible oils, we shall also concentrate more on the refining of technical oils. Our aim is to realise even larger projects in the vegetable oil sector jointly with partners,” explains Bernd Kunze, Technical Head at MAN Ferrostaal for the edible oil segment. In this context, one very promis-ing raw material for oil production is Jatropha. This hardy desert plant is excellently suited for the manufacture of high-quality oil which can be further processed into bio-diesel or as oil for combined heating and power plants. The cultivation of these plants could lead to the realisation of considerably increased yields. Preliminary discussions have already taken place with potential customers.

Markets for edible oilAt the top of the consumers list is China, where the cur-rent consumption of vegetable oil has risen to 25.5 million tonnes. Exploding prices for crude mineral oil, legal admix-ture quotas and the aim for energy security are additional factors driving up the demand for edible oils and oil plants like Jatropha and also for used edible oils.

ManufactureIn addition to substances harmful to health, raw oils also contain constituents which have a negative influ-ence on the flavour and the keeping qualities of edible oils. Because of this, edible oils are usually refined al-though cold-pressed oils are an exception here. Two different refining processes are available, chemical and physical refining. Both process stages are used by MAN Ferrostaal.

Chemical refining is only used today for oils which are very difficult to refine, such as cotton seed oil. The more modern and more environmentally friendly process is physical refining. In the process stages of degumming, bleaching and deodorising with distillative removal of acid, mucilage (phosphatides), pigments (e.g. carot- inoids, chlorophylls), soaps, trace metals, oxidation products, odour and flavour substances and free fatty acids are removed. In this way, it is possible to manu-facture healthy products in an environmentally friendly manner with a minimal input of energy.


Raw oil

Edible oil

Degumming Bleaching Filtration WinterisingDistillative re-moval of acid Deodorising

Tank storage

Edible oil refinery in Emden, Germany

Edible oil manufacturing process








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Biodiesel instead of oilIn April 2008, MAN Ferrostaal handed over a turnkey biodiesel plant with an annual capacity of 10,000 tonnes to the customer lotos Biopaliwa. with this project, the Essen-based firm is setting a new tone in a Polish region dominated by coal mining and mineral oil refineries.

The new biodiesel plant in Czechowice-Dziedzice stands on the site of an old refinery.

In the city of Czechowice-Dziedzice, near Katowice, with its 35,000 inhabitants, there was once an oil refinery owned by the Polish Lotos Group. But, in March 2006,

the plant was closed. A modern biodiesel plant now stands on the site, securing today’s jobs with tomorrow’s fuel. In the construction of the plant, MAN Ferrostaal, as general contractor, worked closely together with the Polish com-pany Prochem. This partner firm has in the past carried out various engineering contracts and plant installations for the pharmaceuticals and petrochemicals sectors and for the automobile industry in Poland. More than 200 em-ployees ensured that, after nearly 22 months, the project could be handed over on time. The Polish added value share was about 50 percent and the total investment vol-ume was 25 million euros.

Local politicians also lent the biodiesel project their full support. After only eight months, all the permits had been issued. So, instead of the former refinery, the new biodie-sel plant now stands in Czechowice-Dziedzice. “Now the old tanks are shining again,” says Helmut Brand, Head of the Essen plant constructor’s Biodiesel department. “The remediation of the site was an enormous challenge, but we overcame it. Our many years of experience in project development and financing and our best partner model were valuable here,” says the Project Manager, drawing on his own experience of the plant business.

What distinguishes the best partner model is that MAN Ferrostaal offers the customer individually tailored so-lutions and is not tied to specific suppliers. Unlike most competitors, the firm’s contribution goes beyond the EPC services (Engineering, Procurement, Construction) and be-gins early in the project development. Capital participation in certain projects is also possible.

The company has been building edible oil plants for over 30 years and these have a similar structure and function (more information on this subject on pages 24ff). For MAN

Ferrostaal, the project in Czechowice-Dziedzice is the first completed biodiesel plant, so it represents an important reference. The new business segment of Biofuels will be expanded further.

Katowice

Łódz

Kraków

Radom

wrocław Dresden

liberec

Cottbus

Prague

ostrava

Zilina

Gliwice

CZECH REPUBlIC

GERMANy

SloVAKIA

l o w E R S I l E S I A

l E B U SG R E A T E R P o l A N D

Ł ó D Z

M A Z o V I A

S w I E T o K R Z y S K I E

l E S S E R P o l A N D

S I l E S I Ao P o l E

Czechowice-Dziedzice

PolAND

Thanks to its very efficient processes, MAN Ferrostaal can manufacture ei-ther edible oil or biodiesel from a wide variety of raw materials. In the case of biodiesel production, pharmaceutical glycerine is also obtained through the addition of methanol.

108 kg methanol

Biodiesel plant

Production of multi feedstock:rape oil, soya oil, palm oil

(Example: rape oil/1,030 kg)

Refining1,000 kg edible oil

1,000 kgbiodiesel

103 kg pharma-ceutical glycerine

´

´

30

rubrikProjECtS

The contract with Lotos Biopaliwa, a subsidiary of the second-largest mineral oil concern in Poland, was signed by MAN Ferrostaal in May 2006. In the run-up period, the company had already provided consulting support for the customer and it then won the tender for the project.

For the production of biodiesel, the Essen concern relies on the CD process developed by the German engineer Dr. Joosten Connemann (CD = continuous deglycerolisation; THE ECHO December 2006). This very economical technol-ogy makes it possible to achieve a biodiesel quality above the European standard. Other advantages are favourable consumption values and high availability. While, in the case of conventional biodiesel plants, 330 production days are reckoned on per year, the CD process makes up to 360 pro-duction days possible. MAN Ferrostaal possesses a world-wide licence for this technology from the firm Ölmühle Leer Connemann, a member of the ADM Group.

A large part of the biofuel from Czechowice-Dziedzice is to be mixed with mineral diesel. Since the beginning of 2008, there has been an ordinance in Poland for the admixture

of biofuels to conventional fuels. An income tax exemp-tion for biofuel components represents a major incentive for Polish producers. The German Office for Foreign Trade (bfai) estimates the total national capacities for biofuels at the beginning of 2008 to be 450,000 tonnes.

Chemically, biodiesel is a fatty acid methyl ester. In its pro-duction, ten percent methanol is added to vegetable oil (in this case rape oil). This produces methyl ester and glycer-ine. The latter can be used, among other things, for cosmet-ics or for the manufacture of plastics and microchips. The harvest from a rape field with an area of one hectare yields about 1.6 tonnes of biodiesel.

MAN Ferrostaal is currently building a further biodiesel plant with twice the capacity of the Polish plant for the customer J&S Bio Energy B.V. in Amsterdam (THE ECHO August 2007). The purchasing activities for this project are now concluded. Completion is planned for 2009.

Rape is an important feedstock for the production of biodiesel. From the harvest of a field with an area of one hectare, 1.6 tonnes of biodiesel can be produced.


Methanol catalyst

Condensate

Condensate

Methanol catalyst

Reaction colums

SteamWater from the second wash

Water from the evaporation Vacuum

Methyl ester

Steam

Semi-raffinate

Reaction stage 1 Reaction stage 2 Wash stages Drying

Biodiesel production process

Glycerine, methanol and water

Rape is an important feedstock for the production of biodiesel. From the harvest of a field with an area of one hectare, 1.6 tonnes of biodiesel can be produced.

Reaction column

Centrifuge

32

Projects

Competence Centres in Germany and Brazil

For the effective processing of its markets, MAN Ferrostaal has built two Competence Centres: in Geisenheim (Germa-ny) and São Paulo (Brazil). Sales in the focus markets of Lat-in America and South East Asia, and the niche markets in Europe, the CIS and Africa will be undertaken by the for-eign local companies concerned. The Competence Centres will support them with know-how in project development and technical expertise.

Biofuels market with low raw material prices MAN Ferrostaal locations MAN Ferrostaal Competence Centres Biofuels

© B

ase

map

: car

togi

s, B

erlin

Brazil is a core market for the manufacture of biofuels. That is why one of MAN Ferrostaal’s Competence Centres for this field of activity is also in São Paulo.


The Kyoto Protocol stipulates a reduction of fuel emissions in the industrialised countries by an average of 5.2 percent by the year 2012. Biofuels will play a very important role here.

CO2 emissionsThe future belongs to the biofuels of the second generation: they promise high fuel yields with near CO2 neutrality.

Biodiesel, palm oil - South East Asia

Biodiesel, soya oil - Brazil

Biodiesel, soya oil - USA

Biodiesel, rape oil - Europe

Diesel fuel

2nd-generation EtOH¹

EtOH¹ Sugar cane - Brazil

EtOH¹ Maize - USA

EtOH¹ Wheat - Europe

EtOH¹ Sugar beet - Europe

Petrol fuel

kg CO2 equivalent / GJ

Source: meó, partly derived from the Biomass Sustainability Ordinance(The values do not take into account any land use changes)

Would you like to learn more about our Biofuels business segment?

Contact: Jürgen BettnerPhone: +49.6722.501-455E-mail: [email protected]

You can order the brochure in German, English and Spanish in the Internet.

In the Internet you will find even more information on the subject: www.manferrostaal.com

¹ Ethanol

25.9

15

0 20 40 60 80 100

28.3

48.2

57.7

68.8

85

32.4

36.2

45.3

86.2

2 to

34

Methanol to fuel an economic upturnThe level of prosperity in oman is mainly due to its large reserves of oil. In future, it is hoped to maintain this prosperity through refining natural gas. At the end of 2007, MAN Ferrostaal completed the construction of a methanol plant in Sohar for the oman Methanol Company llC, which will form an important part of the strategy to diversify the omani economy.

ProjECtS

It all began in 2005 in Sohar, 250 kilometres northwest of the capital Muscat: the Oman Meth-anol Company LLC ordered a methanol plant to be constructed in the middle of the desert.

Preliminary work was already underway that year: the picture shows foundations being laid for the concrete bridges (2005).

Completing the concrete pipe bridges and lay-ing the pipes for steam, wastewater and cables (2006).

NEW SERIES

Milestones in pictures The path from a project idea to the finished plant has many steps. The new “Milestones in pictures” series is a new way of looking at project histories, beginning with the MO3000 in Oman.


Representing an investment of 400 million US dol-lars, the plant was designed for an operating ca-pacity of 3,000 tonnes of methanol per day – or

one million tonnes per year – destined for the chemical industry in Europe and Asia. The responsibilities of MAN Ferrostaal related to the construction of the MO3000 plant included the engineering procurement contract, which covered the procurement, delivery and engineer-ing of machinery and materials, and also the creation of a structured finance concept.

There is significant market potential for methanol as a fuel for power plants and vehicles. In the chemical industry it is also a precursor for a variety of other basic chemical prod-ucts, such as solvents.

Typically Omani architecture was chosen for the administration buildings: here, the shell of the main administration building for the Oman Methanol Company LLC (2006).

The methanol is stored in large tanks before being shipped.

A few months before completion: the water treatment plant is being built in the foreground, next to the water pool for fire fighting.

36

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View of the main pipe bridge with de-aerator and air cooler. Further to the right is the scaf-folded methanol reactor and the distillation columns.

The methanol plant MO3000 after commissioning

View of the safety valves of the M03000; in the background, the illuminated compressor house


1 Pre-reformerThe desulphurised natural gas passes through a heated pipe into the so-called pre-reformer. Hot water vapour is added. The gas heats up and it becomes possible to break down the natural gas into its individual components. Natural gas consists mainly of a variety of hydrocarbons. Through the heating process, these hydrocarbons can be transformed into a balanced mixture of methane, hy-drogen, CO and CO2. This split is a precondition for the further processing of the natural gas.

2 Steam reformerOnly after passing through the pre-reformer can the ac-tual conversion process begin because not all the hydro-carbons can be broken down in the pre-reformer. This requires higher temperatures. Through a pipe, hot water vapour is injected into a tubular steam reformer. The natu-ral gas, already partly split, heats up to about 900 degrees Celsius. Then the remaining hydrocarbons also split and a synthesis gas is formed.

3 Catalytic synthesis of raw methanol from synthesis gasAfter the steam reforming process, the hot synthesis gas is cooled down to 250 degrees Celsius and mixed with the remaining split gases in the synthesis loop. The result of the catalytic synthesis is raw methanol. The process is initiated and accelerated by catalysts.

4 Methanol distillationNow the real refining process starts, for the raw methanol still contains unwanted constituents which have to be re-moved. This takes place in two stages. By means of heat, liquid components of the raw methanol are first separated and fed back into the process in order to achieve more efficient methanol production. Then the raw methanol is distilled again and surplus water is removed – raw metha-nol contains a large amount of residual water. What is left is 99 percent pure methanol.

1 2 3 4

Feedpurification

Pre-reforming Reforming Synthesis Distillation

Natural gas

Raw water

Demin unit

Steam Product3,000 MTPD

Process descriptionThe natural gas passes through a supply pipeline into a reactor. There, as natural gas contains sulphur, it is first cleaned – for sulphur is aggressive and attacks some plant components. The actual conversion into methanol does not begin until after the desulphurisation.

Methanol process

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Here comes the sun …

The sun delivers energy day after day, free of charge and completely Co2-free. Together with its partners, MAN Ferrostaal makes it possible to use the energy of the sun in large solarthermal plants for the generation of power, process heat and cold.

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Infinite resourcesSolar energy has by far the greatest potential among the renewables. Theoretically, solarthermal power plants spanning just one percent of the Sahara would be sufficient to cover the current global demand for elec-tricity (German Aerospace Centre, DlR).


Further figures prove that there is no longer any vi-able alternative to the utilisation of solar energy. The International Energy Agency (IEA), an institution of

the OECD, estimates that worldwide demand for energy, on the basis of fuels and electricity, will grow from about 133 million megawatt-hours in 2005 to about 184 million megawatt-hours in 2030. That represents a rise of about 50 percent. In parallel with this energy consumption, emis-sions of CO2 would also rise. This, in the opinion of most experts, is responsible for climate change – unless alterna-tive energies are used.

strong growth considered certain“We assume that, in most countries, legislation in years to come will turn in the direction of sustainable development and the focus on renewables will become ever stronger,” says Dr. Wolfgang Knothe, Member of the Executive Board and Head of the Solar business segment at MAN Ferrostaal. Three quarters of the energy demand will still be met from fossil sources in 2030, according to the IEA scenario. But the share of renewables will rise steeply. Solar, wind and geothermal energy in particular, says the Institute, will rise at an average annual rate of 8.2 percent.

The IEA anticipates very strong growth for renewables, es-pecially in the electricity sector. They currently account for 18 percent of worldwide power production. By the year 2030, the Energy Agency calculates that it will be 29 per-cent. For Europe, it actually forecasts a share of 38 percent. This would mean that, after coal, the renewables would have become the second most important energy source for power in Europe. In concrete terms, this means that the alternative energies would have accounted for about 60 percent of the expansion in capacity in the European Union up to 2030. “This would represent an investment volume of over 600 billion US dollars,” says Dr. Knothe. “Reason enough for us to enter this market.”

loss-free power transport has long been possibleAccording to a scenario offered by the Trans-Mediterranean Renewable Energy Cooperation (TREC), up to 80 percent of the power consumption in the EUMENA Region (Europe, Middle East, North Africa) in 2050 will be covered by re-generative energies. The core elements in this scenario are solarthermal power plants in North Africa and in the Mid-dle East. The power generated here can be fed into a Trans-Mediterranean power network for the supply of the whole EUMENA region. The technology for the almost loss-free transport of power – even over long distances – already ex-ists. It is based on direct current lines.

“We aim to be one of the first movers in the development, construction and operation of solarthermal power plants,” says Dr. Knothe. “Especially in southern Europe, North Af-rica, in the Middle East, in the USA, Australia, South Africa and Chile, we see very good chances. In the medium term, we expect growth for these regions above the 8.2 percent forecast by the IEA. In most of the countries, we have al-ready been well represented for many years, so we now have good prospects for success,” continues the strategist. He set the course for this long ago. By means of skilful participa-tions and by securing promising future technologies, MAN Ferrostaal has established the important preconditions.

Dr. Wolfgang Knothe, Member of the Executive Board, is responsible for the business segment Solar.

42

Here comes the sun …

technologies for tomorrow's powerMAN Ferrostaal operates together with Solar Millennium in a 50:50 joint venture. Together, they concentrate on the construction of solarthermal power plants with an output of up to 250 megawatts. MAN Solar Millennium covers all the major fields of business along the value added chain, from project development and financing, to the technology, turnkey construction of the facility and even the operation of the power plants. The company ob-tains its parabolic reflectors through Flagsol, a subsidiary of Solar Millennium.

A second technology partner is the Solar Power Group, which specialises in solarthermal power plants on the basis of Fresnel technology. Fresnel plants do not use curved mirrors like parabolic troughs, but flat mirrors which are very cheap to produce. These power plants will be very interesting for this reason, but also because they only require about half the mirror area in comparison with parabolic reflectors. Since the middle of last year,

together with the Solar Power Group, in which MAN Ferrostaal has a 25 percent share, the company has been operating a demonstration plant in Almeria in Spain in order to show the practical feasibility of the technology. The Solar Power Group has been engaged for several de-cades in the development of the Fresnel technology. As Dr. Knothe says, “Today, the technology is almost at the production stage. As of 2009, we want to realise its com-mercial application.”

solar cooling, a new field of activityIn February this year, Dr. Knothe extended his business segment to include another technology partner. MAN Ferrostaal acquired a 20.1 percent share (plus a five percent option) in the Aachen-based SOLITEM Group. In this way, the Board Member intends to combine the competence of a solarthermal specialist and manufacturer of parabolic trough collectors with MAN Ferrostaal’s own know-how in cooling and ventilation. The two companies are jointly planning the application of solar cooling, especially in air-

Theoretically, solarthermal power plants spanning just one percent of the Sahara (base value: 9,000,000 km²) would be sufficient to cover the current global demand for electricity (German Aerospace Centre (DLR)).

0 500 km

43

“No industrially active system supplier is operating as yet in the solar cooling sector. Through our participation in SolITEM, we are taking up a strong position at a very early stage, giving ourselves a good start in the competition for market shares.”

ports, shopping malls and large residential developments (district cooling). Markets for the SOLITEM technology are countries in which a high proportion of power con-sumption is expended on the operation of conventional air conditioning units. In some countries in the Middle East, for example, this can reach up to 80 percent. “No in-dustrially active system supplier is operating as yet in the solar cooling sector,” says Dr. Knothe. “So, through our par-ticipation in SOLITEM, we are taking up a strong position at a very early stage, giving ourselves a good start in the competition for market shares. With our many years of competence in classical air conditioning and ventilation

technology and our participation in the leading company for solar cooling, we are ideally placed for successful op-eration in the new market.”

The Fresnel technology is currently undergoing trials at a demonstration plant on the Plataforma Solar in Almería.

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Cold from the heat of the sun

The process heat recovered with parabolic reflectors is transformed into cold: for the air conditioning of hotels or residential facilities, but also for cooling in the food industry, for example.


Solar energy can not only be converted into heat and power, but also into cold. Plants of this type transform the process heat recovered from small-er solarthermal parabolic reflectors directly into cold by means of absorp-tion chillers – without a detour via electrical energy. This is particularly interesting for hot countries, as the demand for air conditioning rises when the sun’s radiation increases. Plants like these which directly trans-form solar energy into cold operate without emissions of Co2, so they represent a sensible ecological alternative.

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A visionary with high aims

Dr. Ahmet Lokurlu, scientist and founder of the SOLITEM Group, Aachen

47THE ECHO June 2008 47

Solar cooling plants can be commercially attractive, explains Dr. Ahmet lokurlu, scientist and founder of the SolITEM Group, Aachen. He is one of the most renowned specialists in the field of solar technology. His opinion is sought all over the world, for his technical developments are regarded as pioneering. The 44-year-old has received numerous prizes for his innova-tions, among others the “Energy Globe” in 2004, one of the most coveted international awards for sustainable energy technology. last year, he was selected by the famous TIME Magazine as “Global Hero of the Environment”. This honour had previously been received by very few Germans – although last year it was also won by Angela Merkel (German Chancellor).

Dr. lokurlu, heat turning to cold – that sounds a bit con-tradictory. Where did you get this idea? When I was a student and, later, an assistant at the Univer-sity of Essen, I had not had a holiday for years. But then I finally took some time out in Turkey. As my skin was no longer accustomed to intensive sunshine, I immediately got sunburnt on the beach. And that was the first time I had the idea that, maybe, the intensity of the sun could also be utilised to produce cooling. That was just a fleeting thought at first, lasting a matter of seconds. But it would not let me go. In my free time, more or less as a hobby, I followed up the idea. Under laboratory conditions, I made a small re-frigerating machine which I operated first with electricity and then with another heat source. Then I installed collec-tors on the roof of the university, and so on. For years, on the side, I attempted to answer the new questions which continually arose.

then i am sure you had many sleepless nights …Of course, but exciting ones too. I always describe that as the erotic phase in the whole development to date. If you are not under financial pressure, you have the process de-tails in your head, you achieve small successes step by step,

continually making progress, and it is really good fun. You know a little bit more every time, ask new questions which would not have occurred to you before, and so on. That is the nature of research. It is really exciting.

But you have followed a long and, i am sure, a difficult road. Did you never have doubts?No. I always kept working on it. Always. I started in 1993 and by 1998 I had got to the stage that, though still under labo-ratory conditions, I had a plant which actually produced cold water. Naturally, there were always moments when I did not know what to do next. But my persistence never allowed me to give up. I simply wanted to know more and I was interested in the process for its own sake. I had no idea that this might one day become my main profession or that I would found a company. The formation of the company only came later, when I was at the Jülich Research Centre, when I already knew that it worked. That was in 1999.

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What happened then?At first there was a small engineering office. Then, at the beginning of 2000, I rented an office at Agit, the Aachener Gesellschaft für Innovation und Technologietransfer, a technology park for start-up companies. In this way, the company slowly grew. In 2001 came the production unit for the collectors in Turkey. I had to procure the necessary finance for this. All in my spare time, for I still had a full-time job at the Jülich Research Centre at that time.

How did you manage it all?I don’t know. You manage it somehow if you are in love with an idea. That is probably the secret. For the whole process is a continual assault on your own ego. Always problems – it is your idea, so everyone expects solutions. But, as time went by, everything developed. The first proto-types came, then the field trials and the first research plant was installed. And you grow personally at the same time. Five years ago, I would not have been able to deal with the difficulties I can handle with ease today. It would all have been a drama. But I constantly receive feedback – and that helps enormously.

You have received a great deal of positive feedback and have been honoured with numerous prizes and awards. What do these prizes mean to you?Naturally, a recognition of my achievements, which did not come easily. And it gives you a good feeling that the world is learning about them and that you are no longer the only one. That other people are thinking about the same things and also believe in them. Those are very im-portant signals for me.

that means, protection of the environment is near to your heart?Of course. I believe in what I am doing. Look, I worked for years on publications. As I am hard-working, there were well over a hundred of them. That is good fun for a researcher. But after a while, I asked myself, what is the good of all these publications? Researchers naturally read the publications of other researchers and we continually quote each other. But we have no influence over whether what we write is actually put into practice. That is different now. Many tonnes of CO2 are saved with my plants. But there are also other activities. When I have time, I give lec-tures in schools and universities to convince young peo-ple that we have to change our behaviour. I try to make clear to them that they should not regard the behaviour of previous generations as natural constants. When we see humans consuming in one day the energy that evolution has taken more than 1,500 years to produce, that is out of proportion. But it is not just the shortage of energy that is going to present us with dramatic problems. And not only us, but even more so the generations to come. The climate problems will be even more dramatic. They have been ignored for years.

Why do you think that is?Public awareness still leaves much to be desired. There are a number of reasons for that. Firstly, a scientist is not like a company representative, who sticks firmly to his presenta-tion. He speaks in the subjunctive and is very restrained, especially if there is a small deviation, which there always is in science. Another reason: humans are optimised for

Dr. Lokurlu was named “Global Hero of the Environment” by TIME Maga-zine in 2007.


short-term processes. This is determined genetically. So there is a certain inability to take such long-term process-es seriously. I travel to many countries and talk to many people. And, as Brecht is reported to have said: food comes first, then comes morality. I try to do my bit to ensure that people all over the world understand that we are all sitting in the same boat. That is very, very difficult.

if what you say is true, the profitability of the plants would be a good argument and, on top of that would come the environmental benefits. How about that?Profitability is a relative term. On the one hand, we are making continual progress towards profitability through our technical developments and, on the other hand, en-ergy prices are rising inexorably, which we have nothing against. Some plants are only amortised after ten years in comparison with conventional plants, and others after

Through his development of systems for solar cooling, Dr. Lokurlu makes an active contribution to protection of the environment.

“The climate problems will be even more dramatic. They have been ig-nored for years. Public awareness still leaves much to be desired.”

only seven years. Without subsidies, by the way. This is assuming a service life of 15-20 years. It is impossible to generalise. Each object must be analysed, the customer’s requirements must be established and the conditions pre-vailing in the country where it is located must be studied. There are many factors. The investment costs and the vol-ume of potential savings are crucial.

in which countries are the prevailing conditions fa-vourable at present?In countries like Turkey, Spain, Italy, Cyprus and, recent-ly, also Greece and Malta. These are also the countries to which we are deliberately going first.

And the profitability rises, the more your plants are combined with conventional plants and the more they can be used additionally for heating?Correct. We mainly install plants for process steam and cold generation, but they can also be used to generate heat. This is known as bivalent operation. Then there is the combination with conventional plants, which have to be programmed and equipped with electronic components in such a way that the cheapest energy source is used automatically. In different countries there are different electricity tariff zones. When we have high power prices, for example, our plants take over 100 percent of the out-

put for cold generation, so that conventional refrigeration equipment can be taken off line.

What buildings are suitable for their use? Are there minimum sizes or limits?Downwards, yes. The smallest unit has a cooling output of about 150 to 200 kilowatts. For a hotel, that means it must have more than 20 or 30 rooms for installation of the plant. As a rule, hotels have from one to two megawatts, that is 1,000 to 2,000 kilowatts cooling output. It is much higher for industrial plants. And as there is no upper limit, we are able to make them an excellent offer for our tech-nology. Our aim now is to offer more medium and higher outputs, as the investment costs for these are relatively cheaper, so the amortisation periods are also shorter.

Does the customer need much additional space for the collectors?I knew right from the start that not much space would be available. In hotels or hospitals, for example, every square metre has to be optimally utilised. For this reason, it was very important to develop collectors in such a way that they can be installed on a roof or a parking area. So, firstly, they must be light and, secondly, they must be able to re-sist weather conditions and high wind speeds. In addition to the collectors, apparatus is very often installed which makes it possible to have permanent monitoring and a cor-responding electronic control system.

And what happens if something breaks down on the plant and has to be replaced? We are naturally unable to do everything ourselves, as we did with the first plants. The initial installation is certainly always supervised by us, but maintenance and service can be undertaken by local companies with which we conclude partnership contracts and for which we provide appropri-ate training and familiarisation.

What about competitors?We are currently still the only ones who have mastered this technology, meaning the whole system. We have been able

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Solar cooling is especially suitable for warm countries such as Turkey.

to gain a great deal of know-how with the four plants we currently have in operation, so we have an enormous lead over others who are also conducting research and operat-ing trial plants for the same purpose. So, up to now, our competitors are conventional plants.

Because of the awards you have received and your know-how advantage, international investors are queu-ing up for you. Why did you decide on MAn Ferrostaal as a participation partner?You are right. I have had many discussions with potential participation partners. I was looking for a partner active in plant construction, which operated all over the world and which had already made a name for itself there. That exactly describes MAN Ferrostaal. The company already possesses the necessary international infrastructure,

so that, together, we can quickly offer the technology in the countries concerned. But there is also another factor, which was also very important for me, and that was the impression made by the Executive Board. The chemistry was just right. Mutual respect and confidence existed from the start. And I will never forget how Dr. Knothe said to me: ‘Dr. Lokurlu, I hope that, one day, our children will say that their fathers did something good.’


Solar energy is used for the air conditioning of rooms at a TUI hotel during the hot Turkish summers.

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Solar cooling – tradition meets high-techThe idea is as simple as it is brilliant. Solar cooling from SolITEM em-ploys an air conditioning technique which was discovered back in the 19th century: absorption cooling. This is a thermally driven cooling process. Because of the large amount of heat required, it was long considered eco-nomically and ecologically unviable. But by using the sun as an unlimited source of free energy for heat generation and in combination with state-of-the-art solar technology, absorption cooling is making a comeback.

The SOLITEM technology works with an array of se-rially connected parabolic trough collectors. These concentrate the light on to an absorber pipe which

is filled with a liquid heat transfer medium. The heat, con-centrated in the liquid, is transformed into cold in a steam-driven absorption chiller. Systems like this can be used both for the operation of air conditioning systems, for ex-ample in airports, hotels, private and public buildings, and also for cooling in industry, for example in food process-ing. So these systems represent an ecological alternative to conventional air conditioning and cooling systems. The process steam generated can be used for industrial processes and also for the supply of hot water or for heating. Thanks to these intelligent combinations – using process steam for heating in the winter months and taking account of low-tariff times in which power is cheaper – the system becomes considerably more profitable, as a whole, than comparable systems.

reference plants supply the proofThe technology developed by SOLITEM is already in use in a number of buildings. Together with his team, the company’s founder, Dr. Ahmet Lokurlu, has succeeded in developing a plant concept which triples the efficiency of conventional systems for solar cooling. This makes profit-able operation possible. But that is not all. The technology also contributes to the conservation of natural resources and is free of emissions.

Since 2004, for example, the sun has been cooling the “Iberotel Sarigerme Park” on the Turkish Aegean. And that is not all: the collectors and their connected technology also provide steam for the laundry, supply the kitchen and the hotel rooms with hot water and, in the winter, heat the rooms and the swimming pool. The unique selling point: to do all this, they require 60 percent less energy than conventional systems. There are other SOLITEM systems in the Hotel Grand Kaptan and in the Gebze Institute of High Technology, both in Turkey. Four more plants are cur-


rently in the planning or installation stage, two of these for the Turkish Metro Group. These are for the solar cooling of a wholesale market in Antalya and a shopping centre in Is-tanbul. The technology is also being used for the first time in an industrial operation, in this case for steam generation in the FritoLay foodstuffs factory in Tarsus, Turkey. This makes SOLITEM the leader in the commercial application of this technology.

Functional principle of an absorption chillerAn absorption chiller generates cold by the application of heat, as it possesses a “thermal condenser”. This is what makes it possible to generate cold from the heat. Absorp-tion chillers, like compression machines (for example, the refrigerator), exploit the pressure dependence of the boil-ing and dew points of a refrigerant. Various substances with different properties are used as refrigerants. The re-frigerant must be fully soluble in a solvent. Common re-frigerant mixtures are water-lithium bromide (H2O-LiBr) or ammonia-water (NH3-H2O), which generate cold in a closed, continuous circulation process. The evaporator temperature can be reduced to minus 60 degrees Celsius in absorption chillers, so that industrial cooling processes are possible. When water is used as the refrigerant, the evap-orator temperature is limited to temperatures of five to six degrees Celsius above freezing point.

the fathers of air conditioningWith the discovery of the absorption of ammonia in water in 1777, the basis was laid for the absorption chiller (absorp-tion refrigerator) in 1834. The first refrigeration machine to function in practice came from the American doctor of Scottish descent, John Gorrie, who built it in Florida. He was seeking ways of improving the chances of recovery of his hospital patients in the hot and humid climate of Florida. According to established medical opinion at the time, “bad air” was a major factor in sickness. The winter ice previ-ously imported from the Great Lakes in the north, which represented the only cooling possibility, had become too expensive and too unreliable in Florida because of the long transport distances. Gorrie’s machine was used for making ice and, at the same time, for room cooling. A prototype was built and, in 1851, he registered his patent. But the ma-chine was a financial failure. Gorrie died in poverty a few years later without recognition of his work. In the hospi-tal in Apalachicala, Florida, a model of his machine can be seen today.

Chilling machines did not become commercially viable un-til the 1870s. One of the first large manufacturers was the German industrialist Carl von Linde. In 1873, he patented the first commercial chilling machine based on ammonia. His machine was used in breweries and cold stores and made it possible to produce ice in large quantities all the year round. The British branch of Linde was also involved in construction of the first documented air conditioning system for a residential building, which was installed in the palace of an Indian raja. The invention in 1945 of the absorption chiller using lithium bromide and water made inexpensive large-scale application possible, especially in Japan and the USA.

Collector field Reservoir Existing fossil-powered plant

Building

Hot water

180 °C

Heat exchanger

Hot water 60–80 °C

Steam 4 bar

Steam

Cold water 6 °C

2-stage absorption

cooling system

Steam generator WINTER OPERATION

Cooling

Laundry

SUMMER OPERATION

Heating, hot water

Functional principle of a solar cooling system Parabolic reflectors on the roof of a wholesale market in Antalya

MAN Solar Millennium Middle East foundedMAN Solar Millennium is setting new standards in the Middle East for a sustainable energy supply infrastructure. In September 2007, the com-pany opened its first Middle East subsidiary in the free trade zone of Dubai. This new subsidiary is to develop projects for solar power plants in the region.

Tom Koopmann, Managing Director of MAN Solar Millennium Middle East, explains: “This establish-ment, which is located in the free trade zone of

Dubai Airport and represents the entire MAN Group, has developed into a sales and services hub for MAN products in 16 countries of the region.” With a turnover of over one billion euros, MAN Middle East holds a very strong posi-tion in the Arab countries. “Now we also want to use this strong position and our good relations with industry in the Arab countries to expand our business in the solar power plant sector,” adds Mr. Koopmann.

The countries of the Middle East are currently showing great interest in solar technologies. Abu Dhabi regards itself as the vanguard on the road to a more environmen-tally friendly economy. With the Masdar Initiative, the Emirate set up a new industrial development programme to promote innovations involving energy, technology and more environmentally friendly resources. MAN Solar Millennium Middle East would like to take part in this initiative with the construction of solarthermal power plants in the United Arab Emirates. As general contractor, the company supplies solarthermal power plants with an output of 50 to 250 megawatts.

the parabolic collector technologySolarthermal power plants use the sun’s radiation for pow-er generation by the conversion of heat. The integration of a thermal reservoir permits continuous power generation. In this way, solarthermal power plants can also generate power after dark, so they have the potential to replace pow-er plants operated with fossil fuels. In hybrid power plants, solar energy generation can also be combined with the use of other energy sources such as natural gas or biogas.

In solarthermal power plants, the incident solar radiation is concentrated, with the help of mirror systems, on an absorber pipe which runs parallel to the collector. Ab-sorption of the radiation heats a transfer fluid in the pipe, which generates steam in a heat exchanger. As in conven-tional power plants, this steam is used to generate power with turbines.

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MAN Solar Millennium is a joint venture by MAN Ferrostaal and Solar Millennium. The company combines the competences of both mother companies in the project development and construction of solarthermal power plants. As a general contractor for industrial plants with a worldwide organisation, MAN Ferrostaal is in a position to realise large international projects. Solar Millennium oper-ates worldwide in the renewables sector. Thanks to its many years of experience in the development and realisation of solarthermal power plants, the company has established itself as an important market player in the solar industry.


The countries in the Middle East are showing great interest in solar technologies.

Would you like to know more about our Solar business segment?

Contact: Rainer Kistner Phone: +49.201.818-2544 E-mail: [email protected]

You can order the brochure in German, English and Spanish in the Internet.

In the Internet you will also find more information on the subject: www.manferrostaal.com

Two tanks, more than 70 metres high, each with a useful gas volume of 100,000 cubic metres, are be-ing constructed by MAN Ferrostaal in close coop-

eration with our Brazilian colleagues in Sepetiba, Brazil (THE ECHO December 2007). The assembly work began in November 2007. Unusually, the engineers started with the roof of the first gas holder. “This type of assembly, known as ‘top down construction’ or ‘lift assembly’, permits uni-form sheet construction at ground level, including all the welding work. We start with the roof at ground level; we then lift the whole structure in many stages,” says Overall Project Manager Walter Offner, explaining the assembly procedure. In the case of a conventional construction from the bottom up, the later assembly of large wall and roof sheets would be extremely dependent on the weather be-cause of the great height. It is also easier to weld and paint large format sheets at ground level, and much safer. “Our project has reached the hot phase with this first assembly milestone. Now everything depends on the cooperation with our partners,” says Walfrido Ferreira Nascimento, the local Project Manager.

Through efficient process management, it is possible for the gas plant to make optimum use of the heat produced in the integrated steelworks and, in this way, to improve the energy balance per tonne of steel produced. As gen-

eral contractor, MAN Ferrostaal is offering the customer ThyssenKrupp Companhia Siderúrgica a turnkey package: the Essen headquarters and the Brazilian subsidiary of the MAN subgroup is undertaking all services from project de-velopment to delivery, assembly and commissioning.

The ThyssenKrupp Companhia Siderúrgica steelworks will consist, among other things, of a sinter plant, a coking plant, two blast furnaces, an oxygen steelworks, two con-tinuous casting plants, a power plant and its own harbour facilities. From 2009 onwards, 3,500 people will be work-ing at the Sepetiba site in the Federal State of Rio de Janeiro. The two steel tanks collect process gases from the whole steel complex. Altogether, up to one million cubic metres of blast furnace gas from the furnace and converter gas from the steelworks are produced per hour. They also reg-ulate the works pressure and buffer consumption peaks. The gases are also mixed to a uniform calorific value and sent to the different consumers, such as the steelworks, the blast furnaces and the works’ own power plant. The slabs produced in Sepetiba are destined for the markets in Eu-rope and the USA.

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From the top downIn Sepetiba, Brazil, a steelworks for ThyssenKrupp Companhia Siderúrgica with an annual production capacity of five million tonnes of steel (slabs) will be commissioned in 2009. MAN Ferrostaal is constructing the gas management system for this major project.


Facts and figures

TK CSA gas holders

Contract signed October 2006

Planned commissioning March 1, 2009

Blast furnace gas (BFG) Flow, in 920,000 Nm³/h

Pressure + 130 mbar g

Converter gas from steelplant (BOFG) Flow, in Peak load 260,000 Nm³/h

Pressure + 17 mbar g

Gas holder Type Dry seal gas holder, moving piston with rubber membrane

Gas usable volume 100,000 m³

Diameter 58 m

Total height 72 m

BOFG Booster blowers Type Radial centrifugal blower

Units 2

Capacity per fan 60,000 Nm³/h

Total pressure increase + 120 mbar

BFG Flare stacks Units 2

Capacity per flare stack 460,000 Nm³/h

Pilot burners 4 units for each flare head, natural gas fuel

Height 50 m each

Blast furnace gas holder after the first lift Model of the gas, mixing and storage plant

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Since July 2007, wolfgang Hüppmeier and Joachim ludwig have been in charge of the Piping Supply business unit at MAN Ferrostaal. The market for pipes and pipe accessories has been booming for years, and they want to offer the customer the best possible delivery service. In Germany and the Benelux countries this business unit is one of the market leaders. The two Managing Directors anticipate a growing demand for pipes in western Europe, and also want to expand to other regions, such as South Africa, the Middle East and North Africa.

“we want to continue growing”

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since when has the Piping supply business unit existed?LUDWIG: We’ve belonged to MAN Ferrostaal for about ten years. Before that we were part of Röhrenlager Mannheim. Our business unit was established as a private company in 1953, so it’s over 50 years old. That makes us one of the oldest providers on the market. Many of our competitors are considerably younger.

the two of you have been in charge of the business unit Piping supply since July 2007. What’s changed since then?HüPPMEIER: The first thing was that we began purchasing on a more international basis. Earlier we used to buy mate-rial mainly in Europe. Now we’re increasingly cooperating with Asian suppliers. This is also the result of changes in our sales markets and changed customer requirements. We’re also looking to enter new markets.

What are your core markets, and where do you want to position yourselves in the future?HüPPMEIER: At the moment our core markets are Germany and the Benelux countries, where we’re one of the market leaders. We also supply Eastern Europe, Russia and Central Asia. In addition we would like to position ourselves in the MENA region, which we regard as an extremely attractive market. We’ve had an office of our own in Dubai since the autumn of 2007. The United Kingdom is also very interest-ing for engineering projects. We also want to be present in South Africa. We expect sustained positive growth rates in pipe consumption in our target markets, too. In this sec-tor a large number of engineering companies are not in-volved in construction, but they order material for projects in countries such as Saudi Arabia, Qatar or Egypt. These European companies will continue to have a heavy work-load and generate a corresponding demand. We want to maintain our good cooperation with these customers. So the conclusion is: we’ll have to do both – serve the Euro-pean market and expand into other regions.

LUDWIG: In addition to spreading into new markets we want to develop the company further in the next three to five years and to continue to grow. This also includes setting up new representative offices. We want to be more than just a specialist for C steel products – we also want to be involved in the fields of alloyed pipes and stainless steel. We’ve already started work in the field of alloyed pipes and plan to build up this business step by step. We then want to position ourselves in the stainless steel and boiler tube sectors. These two sectors are both growing fast and offer attractive margins.

How do the two of you divide your tasks?LUDWIG: We make a distinction between the day-to-day business and the service business on the one hand and the project business on the other. Mr. Hüppmeier is in charge of the international project business and the “Gas Projects” area. He’s also responsible for our subsidiary in the Netherlands, where our central warehouse is located. I’m responsible for the domestic project business that supplies German engineering companies, and also for the day-to-day and service businesses.

Who are the well-known customers?LUDWIG: Our customers are basically all operators of pro-cess plants and the large engineering companies, including renowned companies such as Linde and Uhde. Our cus-tomer base also includes Fluor and Chicago Bridge, which

THE ECHO June 2008

Wolfgang Hüppmeier (l.) and Joachim Ludwig (r.) are in charge of the Piping Supply business unit.

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used to be ABB Lummus. In E.ON Ruhrgas we supply the largest and best-known German company in the gas in-dustry. One very important customer in the services sec-tor is Exxon Mobil. We have a master agreement with this company covering the supply of piping material to gas stations in Northern Germany and handle the purchas-ing, storage and delivery of the material for these stations which are spread all over the north of the country. We also have important customer relationships with Liebherr and Vaillant, for whom we also maintain customer-specific warehouses, and we provide them with just-in-time sup-ply of the piping material they need.

recently there has been a lot of talk in the press about new pipelines to Western europe from countries that are rich in oil and gas. How is your business unit posi-tioned in the competition for pipelines, and what ser-vices does MAn Ferrostaal offer in the piping sector?LUDWIG: Major projects such as the Baltic pipeline are not handled by the distributive trades but directly between the investor and the pipe manufacturer, which means that this is not part of our core business. One important func-tion of the distributive trades is that they can also supply small quantities by buying and storing large volumes and selling them on in smaller lots. Despite this we’re also ac-tive in the pipeline sector, especially in Central Asia, Turk-

menistan, Azerbaijan and Uzbekistan. The reserves of raw materials are just being developed and exploited in these countries. So there is a lot of sales potential here.

HüPPMEIER: In addition to the pipeline pipes we also sup-ply the associated accessories here: pig trap stations, lag-ging and welding material. We’ve supplied pigs that run through these pipes to clean them, and “intelligent pigs” which constantly perform safety checks, for example on the welded seams.

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World trade in piping is booming.

“All projects are equally important for us.”

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What particular projects are you working on at the mo-ment?HüPPMEIER: We don’t want to be dependent on individual projects. All projects are equally important for us.

But there are surely a couple of beacon projects which stand out from the rest …HüPPMEIER: We certainly implement projects which are unusual in terms of the application. For example, this year we won a contract to produce pipes for the legs of an oil plat-form in Russia. Currently we're also working on a pipeline project for a 4.5-kilometre-long underwater gas pipeline in Azerbaijan. Both these projects are out of the ordinary.

THE ECHO June 2008

“There’s a lot of sales potential for us in Central Asia.”

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so you can also cater for market niches …LUDWIG: We can cater for market niches because we can also satisfy special requirements. Examples of this include equipping a fertiliser factory in Algeria with piping mate-rial and supplying pipes for an air separation plant to our customer Linde.

What are your most important competences?LUDWIG: One of our central and most important compe-tences is in the C steel products sector, where we’re also a warehousing dealer. Our long-standing supplier relation-ships also enable us to cover the complete spectrum, in other words we offer not just C steel but also stainless steel, accessories and alloyed products.

HüPPMEIER: I’d particularly like to point to our qualified personnel. We have a team in which experienced employ-ees who know the market well and young employees who are highly motivated and very dedicated complement each other. That’s a decisive factor in our business.

How do you win over potential customers?HüPPMEIER: In our business you can only win over new customers with prices and delivery times. We don’t want to handle spot business. Our aim is always to build up long-term relationships with the customer. We achieve this through our good services. These relationships are recip-rocal in a way: if we make a customer’s life easier, they’ll treat us preferentially when they place orders in the fu-ture. Consequently the entire order handling is particu-larly important.

What role is played by the subsidiary MAn Ferrostaal Piping supply B.V. in the netherlands?HüPPMEIER: During my career in the piping business I’ve worked at our Dutch subsidiary for a total of over four years and am still active there as the Managing Director. On the one hand, the location is important for our entire business unit because our main warehouse is located there. On the other hand, the subsidiary serves its own markets and cus-tomers totally independently. Generally we use the same suppliers, but in particular cases everyone is free to make their own decision. The subsidiary works very independ-ently. The combination of Dutch and German thinking is very good for our business unit as a whole. The Dutch pro-vide a great deal of flexibility, we Germans provide stabil-ity. We therefore complement each other perfectly.

What developments can you see on the market?LUDWIG: The market is currently booming, this trend be-ing driven in part by the increasing prices for crude oil. We assume that it will stabilise at this relatively high level in the next few years. The decisive factor for us is that we organised the business unit in such a way that we will be able to succeed on the market in difficult times. We want to use our competences, experience and range of services to continue to operate successfully in the future.

“we have a team in which experienced employees who know the market well and young employees who are highly motivated and very dedicated complement each other. That’s a decisive factor in our business.”


MAN Ferrostaal convinces customers with its highly qualified personnel.

The long-established Argentine company Fesa Alcard specialises in producing credit cards and prepaid tele- phone cards. In late 2007, it bought a new sheet-fed

offset printing system. It hopes this will permit it to open up new market sectors and export to other Latin American countries. “Thanks to the new R 205 E we are excellently equipped to tackle the competition,” says Ivan Posse Pratt, Managing Director of Fesa Alcard, with pleasure. “The state-of-the-art technology from manroland enables us to increase our production capacity still further and to be-come market leader in the card printing segment in Latin America.” Fesa Alcard already produces over five million cards per month.

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Strengthening the market position in Argentina

MAN Ferrostaal has made a name for itself by selling state-of-the-art print-ing technology in many countries around the world. In Argentina, the company markets manroland sheet-fed offset printing systems, and is also very successful with the smaller Ryobi models, which are particularly popular with medium-sized enterprises. Concentrating on two different market sectors has enabled MAN Ferrostaal to consolidate its position on the Argentine market as a supplier of graphical machines.

SErviCES

Prof. Gerd Finkbeiner, Chief Executive Officer of manroland Druckmaschinen

competitive edge through state-of-the-art technologyThe new 4-colour sheet-fed offset printing system is equipped with state-of-the-art technology from manro-land, and a large number of different substrates can be used. The machine also features a fully automatic wash-ing fixture and semi-automatic plate change. Thanks to its equipment, it achieves excellent print quality and per-mits short setup times. The Argentine company Transtex, which concentrates on producing credit cards, also relies on technology from manroland and has chosen an R 304 UV. Selling these two presses has allowed MAN Ferrostaal to further strengthen its position in the credit card sector in Argentina.

MAN Ferrostaal has made a name for itself in Argentina not only by selling sheet-fed offset printing systems – it has also been able to strengthen its market position in the area of smaller sheet-fed offset machines. Since 2006, MAN Ferrostaal has been very successful in marketing Ryobi printing systems to medium-sized printing companies. As a result the company has opened up a new market sector in Latin America, because the Ryobi models are extremely popular on the market. They convince the customers with their good price/performance ratio, high print quality and machine speed. The printing company Entrecomillas has also decided to buy two Ryobi machines.

The company is based in the university city of La Plata and specialises in printing brochures, magazines and advertis-ing prospectuses. It provides its services mainly for the local market. “We haven’t regretted our decision,” reports Marcelo Perique, Managing Director of Entrecomillas, with satisfaction. “Now we have the best basis on which to sig-nificantly increase our turnover and at the same time also to improve the quality of our products.”

“the expectations of our customers have highest priority for us”MAN Ferrostaal’s and manroland’s good market position is due first and foremost to the trust of their customers, who were won over by the high quality standards in the various models. The customers’ wishes and expectations consequently play a central role for the business of both companies. For this reason, Prof. Gerd Finkbeiner, CEO of manroland, invited important customers to a breakfast at the Hotel Emperador in Buenos Aires at the end of last year. In addition to the drupa international trade fair, which took place in Düsseldorf from May 29, 2008 to June 11, 2008, he also presented the latest technologies in the printing system sector and invited the Argentine custom-ers to come to the fair in Germany.


SErviCES

66

The design of the medals is unique. For the first time in the history of the Summer Olympic Games a gem-stone – jade – was used in addition to precious met-

als. This stone has a long tradition in Chinese culture and stands for beauty, respect, love and mutual help. The attrac-

tive stone is integrated into the three medal types in the colours white, light green and dark green and symbolises the connection of Chinese culture to the Olympic ideals.

In addition to the common coinage which is in circulation, the medals and other collectors’ and commemorative coins were produced on German coining presses, all of which were supplied by MAN Ferrostaal. China is particularly ac-tive in the coin production sector.

In order to cover more than just the blank stamping and coinage sectors, a strategy for an extended coining ma-chine portfolio for the focus market China was developed at MAN Ferrostaal. The company now also regularly sup-plies machines for the work processes which are performed before and after stamping. This complied with the custom-er’s wish for a provider who can supply everything from a single source. In this way MAN Ferrostaal also fulfilled its own strategic growth target.

Coining machines for olympic medals

Beijing 2008: in August, a large number of athletes will once again hold one of the coveted trophies in their hand after an exciting competition. This year, the medals and commemorative coins with their unusual de-sign were produced on machines which MAN Ferrostaal delivered to the Chinese mints.

SErviCES

The official emblem of the 2008 Olympic Games bears the name “Dancing Beijing”.


In view of the Olympics taking place in Beijing, not only were large orders placed for producing collectors’ coins and medals in 2003: an investment programme for modernis-ing the production facilities for the common coinage was also launched. The Chinese Central Bank, which is control-led by the Ministry of Finance, is responsible for the in-vestment programme for the mints in Shanghai, Nanking and Shenyang. The contractual partner of MAN Ferrostaal is the China Banknote Printing and Minting Corporation, Beijing, which, as the headquarters of the Chinese mints, is responsible for administering the imports.

The state-of-the-art common coinage has been brought into circulation in large Chinese cities for approximately the last five years and is replacing the simple aluminium coins. Like the euro, some of the modern current coin-age is bimetallic and has a security edge. The supplier of horizontal and vertical coining presses for common coin-age is the German company Schuler, from Göppingen. As the largest Asian coin producer, the Chinese coin industry

also supplies coin blanks and minted coins to other Asian markets.

MAN Ferrostaal maintains intensive contact with the Key Account Chinese Coins with a team in Essen and Beijing. This contact has remained stable for many years, and through extremely careful handling ensures the long-term success of this sales segment. In order to tailor the services of MAN Ferrostaal even better to the customers’ require-ments, the team in Beijing also relies increasingly on local service and marketing of spare parts. In addition to quick implementation, the advantage of the newly founded MAN Ferrostaal Commercial (Beijing) Co. Ltd. is that prices can be quoted in the national currency (RMB), which is appreci-ated by the customers.

The gigantic Olympic Stadium in Beijing was designed by the Swiss architects Herzog & DeMeuron. Because of the intricacy of the steel construction, the citizens of Beijing have nicknamed it “Bird’s Nest”.

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SErviCES

PRODUCTION TOOLING

Surface processing of the coin blanks by means of centrifugal force A Schuler coining press

Work processes in coin production for which MAN Ferrostaal supplies the necessary equipment.

Reducingof the model

Turning of coinage dies/

outside dimension

Hobbing of coinage dies

Polishing of coinage dies

Coatingof coinage dies

Heat treatmentof coinage dies

MillingContinuous

castingRolling Annealing

BlankingAnnealing DryingRimming

Surface treatment;

burring/degrea-sing/polishing

Edge lettering Storing

CoiningPacking


chinese collectors’ coinsThanks to its wealth of collectors’ coins, China is held in high esteem around the world. The sets of Olympic coins consist of five commemorative coins in silver, gold and other precious metal alloys with coloured engravings of the Chinese Olympic mascots. The Olympic mascots are comic book heroes in the colours of the Olympic rings which represent a fish, a giant panda, an Olympic torch, a Tibetan antelope and a swallow. These mascots thus corre-spond to the five elements of water, wood, earth, fire and metal from Taoism, an ancient Chinese philosophy.

Numerous collectors’ coins with the Olympic disciplines as motifs are also available. There is an extremely large de-mand for all the Chinese Olympic collectors’ coins, and most of them are now out of stock on the collectors’ market.

Olympic Games and medalsAt the 2008 Olympic Games athletes from all around the world will once more compete for the coveted medals: gold for the winner, silver for the runner-up, and bronze for third place. The gold medal is actually a silver medal which is coated in gold. In some competitions that are decided ac-cording to the KO system, for example boxing, judo and taekwondo, two bronze medals are awarded.

Medals were first awarded for the top three competitors in St. Louis in 1904. In 1896 and 1900 only the best two ath-letes received a medal (silver for the winner and bronze for the runner-up). They both also received an olive twig. How-ever, some sources also state that the runner-up was hon-oured with a copper medal and a laurel twig. The winner received a gold medal for the first time in 1904; the other medals were each ranked one place lower.

Only since the Rome Olympics in 1960 have the medals been hung around the victors’ necks: back then on chains of lau-rel leaves, and later on ribbons. Before that, they were passed from hand to hand. For the 2008 Olympic Games alone, 1,000 medals in each of the colours gold, silver and bronze will be required. These have been redesigned for Beijing.

A Schuler coining press

One of the sets of Olympic coins, here in silver with coloured engravings of the five Olympic mascots

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CouNtriES aNd PEoPlE

The highlights of his career are five methanol plants and two ammonia plants constructed in recent years by his Petrochemical Industry business unit

acting as general contractor with capital participation from MAN Ferrostaal. One of these plants is the largest methanol plant in the world, the M5000 on Trinidad. With “MAN Ferrostaal support”, the client, Methanol Holdings Trinidad Ltd. (MHTL), has become the second-largest pro-ducer of methanol in the world – and MHTL even counts as the number one producer if the ranking includes its share in the Oman production plants that were also recently constructed by MAN Ferrostaal.

Premium quality in demand For the client there are obvious advantages to a model where the general contractor commits its own capital participation – it is very evidently in the contractor’s own interest to finish the construction on time and within the agreed budget. Furthermore, this broader view of the general contractor’s role extends not only to the handover of the turnkey plant, but also to further elements im-portant for the plant’s successful operation: all the plants are achieving or exceeding agreed capacities, and they are producing according to specifications and with very low

An entrepreneur in the enterprise

Erwin Keutner is one of the men behind an extremely successful business model within MAN Ferrostaal that will now be extended to other segments. The Head of the business unit Petrochemical Industry is setting a worldwide example in development, project implementation and capital participation for large-scale petrochemical plants.

Erwin Keutner, Head of the Petrochemical Industry business unit


downtime. “It is obvious that better quality during plant construction leads to better operation: fewer disturbances, less maintenance, higher reliability, higher cost-efficiency, and thus in turn, higher output and profit margins when the product, for example, methanol, is sold.” This is how the model’s success is explained by the graduate in busi-ness administration, who started at MAN Ferrostaal after finishing his studies and has remained faithful to the company ever since. “In addition, this strategy ensures that the interests of all parties are equally considered. Our participation at all stages of the investment increases the atmosphere of partnership, minimises possible conflicts and ensures that each party gets its fair share of the cake.” For the banks providing the finance, the contractor’s own capital participation is an important sign of the project’s creditworthiness.

no-one elseMAN Ferrostaal is the only company active in construction of industrial plants that pursues a policy of significant cap-ital participation. “Other competitors are unable to do this because they are mainly product or technology oriented. A company that sells methanol plants cannot take a stake in its clients because that would automatically make it its own competitor. Although this also applies to us, we have the option of changing to other products or technologies if a problem should arise. After all, there is nothing that says we have to build methanol plants. We can also build ammonia or fertiliser plants, since we are not tied to any one particular technology.”

This independence in itself is his strategy, reflected in his motto for the whole segment: “Stay as flexible as possible.” As he explains further: “Our model is based on the princi-ple that we go wherever the affordable raw materials are. Of course, we want to build up the methanol and fertiliser sectors as much as possible. However, it would not be a

The largest methanol plant in the world: the M5000 on Trinidad

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problem should these sectors no longer be in demand: we can simply apply the model to the processing of other raw or intermediary materials.”

Great growth potential This step is unlikely to be necessary in the near future, since the markets are looking promising. For methanol the 50-year-old predicts considerable expansion potential into other markets. The latest example is the MO3000 metha-nol plant: the transfer of a successful model from Trinidad to Oman. Further markets to aim for could be found in Asia and, in particular, South East Asia, according to Mr. Keut-ner: “If you want to be the world leader, you need to have production facilities in each of the three main markets: Asia, Europe and America.” The fertiliser market, too, is a real growth market, since the demand for fertilisers is con-stantly increasing globally. Population growth is not the only reason for this: the increasing demand for biofuels is also playing its part. “In this field there is a considerable number of new possible locations,” says Mr. Keutner.

trust and reliability Taking advantage of this potential depends heavily on finding suitable partners. For MAN Ferrostaal, partners are not only clients, but also suppliers and co-investors. The networker Mr. Keutner places great importance in de-veloping a true partnership – in other words, something beyond the conventional supplier or client relationships. “We work through the ups and the downs together. Each partner is not seeking to get the most out of everything for themself; instead, there are joint efforts to optimise the project. This is somewhat different to the usual atti-tude you find,” explains the business unit Head. He goes on to list particular qualities that are essential for such a partnership, which he describes as characteristic of MAN Ferrostaal: entrepreneurial thinking, honesty, trust, re-spect, transparency and reliability.

This is also why he considers it essential to involve local on-site partners. “We do not want to exploit the countries with the affordable raw materials – we want to ensure that money and added value remain in those countries,” he states.

The fact that he is responsible for billions of euros is not something that keeps him awake at night. “You have to be able to handle responsibility,” he explains, thinking of his employees, “but you also have to be able to delegate it.” Despite his position, Erwin Keutner retains his modesty. He is not a man to put himself in the limelight, and this is probably part of his success, for he is undoubtedly a very popular man.

Erwin Keutner together with Clinton B. Ramberansingh, Managing Director of IPSL Industrial Plant Services Ltd., the operating company of the metha-nol and ammonia plant on Trinidad.

“If you want to be the world leader, you need to have production facilities in each of the three main markets: Asia, Europe and America.”


Refining column at the MO3000 in Oman

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laNd uNd lEutE

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75DAS ECHO Dezember 2007 75

A sleeping giant wakes!


South Africa counts as one of the world’s emerging economic powers. After successes in the fields of offset and printing machinery, MAN Ferrostaal now wants to construct large-scale industrial plants from Johannesburg to the Cape of Good Hope. There is also huge potential for its new business segments Solar and Biofuels.

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Cape Town is, besides Johannesburg, the economic centre of South Africa.


In February, 2008, SAP co-founder Hasso Plattner launched a new issue of the Hasso Plattner Ventures Africa fund. The fund has a volume of 350 million rand (31 million euros) and supports South African start-ups as they bring their products to the global technology market. MAN Ferrostaal is one of the fund financers.

Venture capital fund for South African start-ups

The fund makes financial assistance available to en-terprises who demonstrate an innovative business model. It focuses on activities in South Africa and

plans to include neighbouring countries in its scope. Core areas of interest for investments are telecommunication and renewables in their early stages of development.

In the last three years, Andrea Böhmert, the Fund Man-ager, has helped newly founded technology companies to prepare themselves for debt capital financing. She says that Hasso Plattner Ventures Africa intends to identify enterprises that have the potential to be successful on an international scale. Through their investors, these enter-prises will then gain access to a network of leading com-panies, venture capital firms and institutions from the technology sector.

In the past it was almost impossible for South African com-panies to gain financial support from international insti-tutions outside the country: “Young enterprises all know that not only is the capital important, but also the practical support as they take their ideas to international markets. This is where our fund can help. Prof. Plattner and MAN Ferrostaal are able to open doors for the start-ups which would otherwise remain closed to the IT and industrial

plant construction sectors,” explains Ms. Böhmert. MAN Ferrostaal’s involvement in this fund is part of its activities to work off its offset commitments in South Africa.

Left to right: Andrea Böhmert, Fund Manager; Dieter W. Haller, German Ambassador to South Africa; Phumzile Mlambo-Ngcuka, South African Deputy President; Hasso Plattner; Dr. Klaus Lesker, Member of the MAN Ferrostaal Executive Board

Sean De Lancey enjoys daring challenges: the 49-year-old engineer began his career as a pilot in the South African Air Force. Later he worked as an engineer,

among other things on the Atlas Cheetah jet fighter. When he switched to the industrial sector after 19 years of ser-vice, he stayed in aviation and worked on helicopters and other projects for Denel. Later he founded his own engi-neer consulting company, working for EADS and Zeppelin Luftschiffahrt.

Mr. De Lancey sees great potential for MAN Ferrostaal in South Africa: “In the next ten to 15 years enormous sums are due to be invested in the infrastructure. Estimates speak of over one thousand billion rand (around 100 bil-lion euros); most of this will be government money that will be pumped into the economy. Last year the South African government recorded a budget surplus. MAN Ferrostaal has a good reputation, excellent project man-agement and outstanding risk management. This puts us in a good position to participate in the region’s growth.”

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The BRIC countries (Brazil, Russia, India, China) are the new stars among the emerging markets. However, South Africa, with its rich reserves of raw materials, also seems very promising. In recent years MAN Ferrostaal has successfully performed offset obligations there. The company’s aim is to establish itself as one of the best names in Southern Africa in the industrial sector. Sean De lancey, the new Managing Director of MAN Ferrostaal in South Africa since January 2008, would like to achieve this goal.

Participating in growth

MAN Ferrostaal has already handled offset business with the government in recent years. These offset obligations also involved, among other things, constructing shipyards and investments in a chip factory and a tea plantation (THE ECHO December 2007). The company gained a good reputation through this business. Mr. De Lancey would now like to build on these successes and to make MAN Ferrostaal one of the country’s leading market participants in the industrial sector.

Good business opportunities for solar and BiofuelsHe sees good business opportunities above all in the stra-tegic growth sectors of solar and biofuels: “There is cur-rently an energy crisis in South Africa; electricity demand exceeds supply. Its high level of solar radiation means that the country offers great potential for solar power plants. The South African Government is promoting and invest-ing in alternative energy. In addition to power plants, solar cooling is also extremely interesting for our country. As for the biofuels sector, the government recently published a strategy paper on this subject, aiming to support a bio-fuels industry. South Africa has a strong sugar agriculture and market. This fits well with our sugar-ethanol solutions.

So far South Africa has only seen pilot projects in the bio-fuels segment and not a proper market, but I’m optimistic that we can be successful here in the future,” says Mr. De Lancey. He also sees sales potential for petrochemical and metallurgical plants.

The things the 49-year-old cherishes most about his na-tive country South Africa are above all the friendliness and openness of the people. “Most people in South Africa are very friendly, polite and easy to get along with,” he says. Mr. De Lancey sees the good climate for investors as a fur-ther advantage. In business, he likes to establish long-term partnerships that are based on trust.

He is very confident about the future of MAN Ferrostaal in South Africa: “There’s no industrial concern here which can claim to have completed over 5,000 projects throughout the world. Furthermore, in its long history the company has always been in the black. These are our unique selling positions on the South African market. The challenge is to make ourselves better known in the national industrial sector. When someone is planning a major project, our number should be the one which they dial first.”


Sean De Lancey, Managing Director of MAN Ferrostaal in South Africa

80


The number of newspaper readers in South Africa has risen by over 40 per-cent since 2001. In addition to 19 daily newspapers there are 352 weekly and monthly papers. MAN Ferrostaal is also profiting from this boom. The com-pany has been able to significantly increase its market share in the graphics sector in South Africa in recent years.

Market leader in roll-fed printing

Since 2005 we have sold an enormous amount of roll-fed printing equipment. The market for roll-fed printing is growing very fast, particularly for

newspapers and commercial roll-fed offset printing. In this sector we have cornered 85 percent of the South Afri-can market,” says Glyn Gilbert, Managing Director of the printing sector of MAN Ferrostaal in South Africa. The company covers the whole range of applications in the printing sector, from the prepress stage to finishing. Part-ner companies such as manroland and Ryobi, worldwide leaders in their field, ensure high product quality. MAN Ferrostaal is the largest supplier-independent service pro-vider for the graphics industry in the world.

One of the most important customers in South Africa is the Naspers Group, which operates in the print media, tele- vision and Internet sectors. Media24, a subsidiary of this group, publishes all the main Afrikaans language news-papers in the country. Regular customers also include companies such as the Caxton Group, whose publications include the newspaper “The Citizen”, and Nampak Cartons and Labels, Colorpress, Blesstons and Independent News-papers. In particular, manroland machines are extremely popular in this most southern state in Africa. When coop-erating with South African companies, Mr. Gilbert gives priority to the personal relationship: “Only if you have a good business relationship will the necessary doors and

opportunities open up. In the printing industry, mainte-nance and service are also of central importance.”

This entrepreneur is also optimistic about 2008 and ex-pects healthy growth in the graphical industry in South Africa. “I’d like to increase our market share even more in the future. The situation for sheet-fed offset printing is good, especially for manroland in the A1 market. There are also a large number of projects related to offering Ryobi offset machines, which are regarded as among the best in the world.” MAN Ferrostaal employs a total of 97 em-ployees in the printing industry in South Africa. In addi-tion to the headquarters in Johannesburg, there are also subsidiaries in Durban and Cape Town. The company also supplies machines to other countries in southern Africa such as Botswana, Zambia, Malawi, Mozambique and An-gola. Around 90 percent of the African printing market is concentrated in South Africa.

“


The South African newspaper market is booming. MAN Ferrostaal covers the whole range of applications from prepress to finishing.

Glyn Gilbert Glyn Gilbert has been employed at MAN Ferrostaal in South Africa since April 1999. In 2001 he was promoted to Managing Director for the printing sector.

Hannes KritzingerHannes Kritzinger is Managing Director at the company Printing Products, which MAN Ferrostaal acquired in 2005. It was previously privately owned. Printing Prod-ucts specialises in prepress and post press equipment and packaging machines. In the prepress business, the company is the South African distribution partner for Fu-jifilm, Krause and Luscher, and in the post press sector Printing Products represents Ferag, Sitma and Recmi. An important partner in the packaging sector is Kiefel Extru-sion and Thermoforming.

Contact: Glyn GilbertPhone: +27.11.613-7820E-mail: [email protected]

Contact: Hannes KritzingerPhone: +27.21.948-0820E-mail: [email protected]

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with its up-and-coming economy, South Africa is an attractive market for foreign business people. However, real success in Cape Town, Durban, or Johannesburg is reserved for those who know the local conditions. This brief guide to business etiquette summarises the most important basics for dealing with South African business partners.

Quick business etiquette guide for South Africa


The most important basic prerequisite for good contacts to South African partners is a good level of English. You will not be taken seriously as an inter-

national business partner if you turn up to meetings with an interpreter or try to get by with the rusty English you once learnt at school.

Do not rush in and greet unknown people yourself: wait to be introduced. However, if more than a few minutes pass without an introduction, then you can introduce yourself when you say hello. In South Africa it is usual to enquire about the health of your conversation partner and their friends and relations. When leaving the meeting, you should briefly say goodbye to each person present. Older people en-joy some privileges: they are greeted first; they are allowed to enter a room first; and they should be the first to be of-fered a seat. The usual way for men to greet each other is with a short, firm handshake. Business cards are often ex-changed during introductions. It is common to be on first name terms right from the start; this is, however, not a sign of familiarity – it is simply the way things are done.

When in conversation, avoid potentially controversial top-ics such as racism and African politics. People who come across as arrogant or as ‘know-it-alls’ are also unlikely to make many friends – South Africans are proud of their industrial achievements, their know-how and their infra-structure. Other topics where it is easy to put one’s foot in it are religion and emigration. The worsening shortage of specialists and managers has led to a situation where even business partners with a comparatively low position in the company hierarchy have significant room for manoeuvre in negotiations. If taking part in public sector tenders it is very advisable to join forces with a “Black Economic Em-powerment Partner”: your chance of success is very slim without one.

As far as body language is concerned: never point in any-one’s direction with your shoe and never show the soles of your shoes. This is considered vulgar. In public you should also avoid yawning and putting both hands on your hips.

Observe a smart business dress code. Even when tempera-tures are high, men wear a tie and a jacket. Sandals are out of the question. Business meals take place mainly at midday: in the evenings South Africans go to bed relatively early. In fact, breakfast appointments are not unusual. Preferred lo-cations for business meals are traditional restaurants with international cuisine, or golf and country clubs. In South Africa smoking is only allowed in special smokers’ rooms or outside. If you are hoping for an invitation to a more private event such as “Braai” – a social gathering with bar-becue and beer – please note that this only occurs when the business relationship has become well established. South African hosts are mostly very attentive towards their in-ternational guests, often meeting them at the airport and then driving them back again upon departure.

Toasts are not common at business meals, and after-din-ner speeches are only made at special events. At a formal dinner you should wait until the host has begun to eat, or until you are invited to start eating. Alcohol is consumed in moderate quantities at midday meals, and at dinner in the evening sometimes more. In general, the same basic rules apply at business meals as in Western Europe.

Most South Africans are very understanding if you arrive late due to unavoidable or unexpected circumstances. Schedules are relaxed and flexible. Business trips are often inconvenienced by long weekends, which are also often extended with extra holidays. If a public holiday falls on a Sunday, the next working day becomes a holiday. It is advis-able to arrange business appointments before you leave for South Africa. Making contact with written letters is not the best solution, since the postal system is somewhat slow and unreliable. Not every South African businessman reads his e-mail every day. If you need to know whether an im-portant piece of written correspondence has been read, it can be helpful to ring the person concerned or make use of the “confirm reception” function for e-mails.

Angola Filda Angola, Luanda, 15 – 20/07/2008 Alimentec Colombia, Bogotá, 12 – 16/08/2008Fenasucro Brazil, Sertãozinho, 02 – 05/09/2008MsV 2008 Czech Republic, Brno, 15 – 19/09/2008 inno trans – international trade Fair for transport technology Germany, Berlin, 23 – 26/09/2008Packaging China, Beijing, 24 – 27/09/2008expoAlemania Chile, Santiago de Chile, 25 – 27/09/2008

Power expo Spain, Saragossa, 25 – 28/09/2008expo Alemania Bogotá Colombia, Bogotá, 29/09 – 03/10/2008KiOGe Kazakhstan, Almaty, 07 – 10/10/2008tiOGe Turkmenistan, Ashgabat, 20 – 21/11/2008

aPPENdiX

84

International trade fairs July to December 2008

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responsible for the content:Daniel Reinhardt

editors:Angela Kanders (Managing Editor)Oliver Haastert, Katja IflandContact: [email protected]

Other contributors to this issue:Stefan Breuer, Glyn Gilbert, Gilbcaroll Hernández, Hannes Kritzinger, Birgit Kronenberg, Holger Lexius, Joachim Lud-wig, Helmut Mühlemeier, Walter Offner, Nadia Rindle, Carmen Sack, Ingo Trenkner

Picture credits:Getty Images: pp. 1, 16/17, 18, 24, 30/31, 32, 33, 40, 55, 60/61, 64/65, 67, 74/75, 82, 85; Karsten De Riese: pp. 2, 34/35, 36, 38/39, 43, 44, 50, 51, 53, 73, 76, 78/79, 81; Hauke Dressler: p. 71; Andreas Pohlmann: p. 3; Mauritius Images: p. 6; Dr. Guru Dutt: p. 7; Jeremy Nicholl: p. 7; Piet Sinke: p. 9; Catrin Moritz: pp. 10, 20, 21, 46, 49, 59, 60, 61, 70; Harms Bergung: p. 11; Florian Zimmermann: p. 12; Schmidt+Clemens: p. 14; Laif: p. 20; Markus Steur, Dortmund: pp. 25, 26, 27, 28; NASA/Wikimedia Commons: pp. 42/43; Corbis: p. 45; SO-LITEM: p. 48; iStockPhoto: p. 58; Manfred Ehrich: p. 63; Schuler: p. 68; Methanol Holdings Trinidad Limited (MHTL): p. 72; SCAN Display: p. 77; Dirk Friedrich: p. 79

Design and layout:BOROS

Printing house:Woeste Druck, Essen

Printed on a five-colour roland 700 by manroland

Frequency:half-yearly


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