PALYJA to double investment

PALYJA to double investment to improve clean water supply

PT PAM Lyonaise Jaya (PALYJA), a subsidiary of ONDEO Services of France, will more than double its investment to improve and expand the supply of clean water in western Jakarta.

"New investment of about Rp 700 billion (US$80 million) by 2007 is required for the construction and replacement of facilities for the production and distribution of clean piped water in the western zone of Jakarta's Ciliwung river," says PALYJA's president director, Gauthier Prate.

This new investment plan designed to extend the coverage of piped water and further improve further service quality has been submitted, together with a tariff adjustment plan, to the relevant authorities.

PALYJA, under a 25-year agreement with PAM Jaya, is responsible for the processing, supply and distribution of clean water in the western zone of the Ciliwung river -- including West and South Jakarta, as well as major parts of Central and North Jakarta.

It is assigned to manage water treatment plants already established in Pejompongan (with a processing capacity of 5,600 liters per second), in Cilandak (400 liters per second), in Taman Kota (200 liters per second) and in Muara Karang (100 liters per second), and to operate the distribution centers and reservoirs in Lebak Bulus and Kebon Jeruk, each with a supply capacity of 1,400 liters per second.

Since the establishment of the 25-year partnership with PAM Jaya in February 1998, PALYJA has invested more than Rp 550 billion for the expansion of its pipeline network from 3,000 kilometers to 3,702 km, the replacement of 394 km of pipes, and the installation of 90,500 consumption meters for new customers and replacement of 77,200 meters for existing customers. It has also rehabilitated the water treatment plants and pumping facilities in Pejompongan, Cilandak and Muara Karang.

"With the planned improvement of the quality and coverage of our water supply and services, more and more residents and offices in the city are expected to rely on our services," Prate says. "Thus, we will help sustain the health of Jakarta's residents and the environment." City residents, he says, should be made aware about the importance of relying more on piped water because the increased utilization of ground water, as a result of the rapid increase in development activities and high population growth, has caused environmental degradation. The city administration, for example, has warned that over- exploitation of ground water, together with a major increase in construction, may cause the subsidence of land in the city by a rate of 1.5 centimeters to eight centimeters a year. "With the improved awareness of the residents, we aim to increase our customer base by more than 50 percent by the end of 2007," he says. The number of PALYJA customers has already increased by nearly 50 percent, from 200,000 in February 1998 to almost 300,000 at present. About one third of the customers are low-income families, for whom the water rate is set at the lowest level. However, the rate needs to be adjusted in order to allow further investment and alleviate the problems faced by Jakarta residents, especially in the north. PALYJA's water rates are set progressively, ranging from the lowest level of Rp 375 to the highest level of Rp 5,200 per cubic meter for big users only. Since 1998, PALYJA increased the water sold to the customers by over 20 percent. Prate says PALYJA's new investment plan will enable it to continue improving its operational efficiency so that its water losses, which have declined from more than 60 percent in 1998 to 47 percent at present, will continue decreasing to 37 percent by 2007. Ondeo, the water division of SUEZ, comprises four key businesses: Ondeo Services, Ondeo Nalco, Ondeo Degrimont and Ondeo Industrial Solutions.

The world leader in water-related services, Ondeo serves 115 million consumers and 60,000 industrial customers, and has built more than 10,000 water treatment plants around the world. Ondeo's objective is to be the premier provider of sustainable water- related solutions and services worldwide, through long-term partnerships that benefit its customers, communities, employees, and the environment.

In 2001 Ondeo's revenue reached over 10 billion euros.