Investment in OTEC
Transcript of Investment in OTEC
Investment in OTEC6 KEY STEPS From Idea to Sales, Sustainability and Growth
Mizuan A. Manaf
UTM Holdings Sdn. Bhd.
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Investment in OTEC6 KEY STEPS From Idea to Sales, Sustainability and Growth
1. Market • What Business are you in? / How big is this Opportunity?• Fundamental Market Studies
2. Customers• Who is going to buy your products? At What Price?
3. Supply Chain• Who can help you succeed
4. Generating Revenue• Knowing your numbers• Capex, Opex, Revenue, Returns
5. Building Value• Creating the intrinsic Value• Strengthens & Protects• Key to Sustainability
6. Managing Money Wisely• How you use the money to build value• Key to Growth
7. GOAL; Happy Investors Constitute a Successful Business Outcome
Steps 1, 2 and 3Will get you to
7ONLY IF
YouStrategically Manage
Steps 4,5 &6
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29,850 sq km
76,060 sq km
25,210 sq km
For Illustrative Purposes
KOTA KINABALU
Kuala Baram
Labuan
Kuala Penyu
P. Balambangan
30 km
Semporna
20 km
LL2H
GK1E
KB2E
PB3E
SP1H
Total Area = 131,120 sq. km (>700 m)
Total OTEC Potential = 105,000 MW
Projected installed capacity of OTEC by 2030 = 2500MW
- matching nuclear power.
P.Banggi
SP1H
Estimated Total Capital Investments of USD 500 billion @50% of total resource potential
Investment in OTECStep 1 Market; How Big Is this Opportunity?
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1. Need• Nice to have Vs Must Have
• Compelling Need!! specific medicine not supplement (Steve Job)
• Place in the eco system (Destructive Technology)
• Market Size
2. Approach• Describe Concept to Completion / Sketches to prototype / Implementation Plan
• Resources (ie. Man Power, Tools/Plants)
• Business Model (Framework) / Financial Projections
3. Benefit per Cost Value• Translating technical benefit into numbers
• Elevator Speech / Punch Line / To know more
• Catches Customer Attention
• Attractions to Investors
4. Competition and Alternatives (Who are the players)• What is competition? (like for like; Coke & Pepsi)
• What is alternative? (Coffee, Juice or Plain H20)
5. What’s Next - Moving Forward
Investment in OTECStep 1 Market; Fundamentals Studies
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Investment in OTECStep1 Market; Punch Line
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Fuel Cost
O&M Cost
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OIL Total Cost: USD 7.7 billion OTEC Total Cost: USD 1.5 billion
OTEC WILL SAVE OVER USD 5 BILLION/100 MW
Years
Years
COMPARISON FOR A 100 MW PLANT
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Investment in OTECStep 2; Customers
1. Products & Customers’ Willingness to Pay• Energy
• Hydrogen
• Water
2. Customer; Electricity• Deep Sea O&G Platform - Currently Using Gas (Security & Stability Issues)
• Agreed Discount compared to status quo
3. Customer; Hydrogen• Transportation (Consumer Consumption and Government Subsidy Savings)
• Smart Grid for Remote Areas (Subsidy Savings)
• Data Centers (Energy Security)
4. Customer; Water• Potable Water
• Deep Sea Water
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Investment in OTECStep 3; Supply Chain
1. Sun!!!
2. Resource (Water Column > 700m)• 131,120 sq.km
• 105,000 MW potential
• Eco-System
3. EPCC Team• Manufacturers
• Consultants
• System Integrators
4. Operators• Maintenance Contractors
• Logistics Vendors
5. Financiers• Bankers
• Venture Capital
• Investors
• Sponsors
• EPCC8
Investment in OTECStep 4; Generating Revenues
FINANCIAL PROJECTION FOR A 15 MW OTEC PLANT
Investment Cost USD 160,000,000
Annual Revenue USD 17,181,408
Payback Period 12 years
NPV USD 36 million
IRR 12.6%
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Investment in OTECStep 5; Building Values
1. Creating the Intrinsic Values • Strengthen
• Protects
2. Key to Sustainability• Hard Work to Reach the First Big Sale, even Harder to Continuously getting Sales and GROW
• Many Competitor Products created based on the Success of Others (F&B VS Airline)
3. Values• Intellectual Properties (Turbines, Heat Exchangers, Membrane, Design, Integrated Systems, Controls)
• Corporate Governance, Asset and Equity
• Strict NDA and Controls of Supply Chain Partners
• Government Involvement; Comprehensive OTEC Act and Policy
4. Contributions back to Country and Society • Royalty
• Trickling down effects / Spin Off Companies / Job Creations10
Investment in OTECStep 6; Managing Money Wisely
1. Capital Expenditure• EPCC
2. Operating Expenditure• To be used in transacting the business
• Man Power, Maintenance, Logistic
3. Revenues• Profit = Revenue – Cost
• EBIT = Profit - Overhead
4. Cash Flow • Movement of Cash in and out of Business
• Often used to calculate a company value or to determine its situation
5. Terms and Conditions, AR Policy, AP Policy, Sinking Fund, Growth Investment
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