The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A former Water & Sewerage Corporation chairman yesterday said an all-Bahamian investor group was “very optimistic” it would win its bid to take over operations at the Windsor reverse osmosis plant and replace BISX-listed Consolidated Water.

Don Demeritte, who is a member of the EPS Consultants consortium, told Tribune Business that the group felt it could offer “the best cutting edge solution” in terms of technology and the price at which it would sell water to the Water & Sewerage Corporation.

EPS Consultants, though, face stiff competition from the incumbent, Tribune Business having previously revealed that Consolidated Water wants to negotiate a five-year extension of the existing lease and water supply arrangement with the Corporation and the Government.

The current deal is set to expire in May 2013, when Consolidated Water will hit its total water supply target from the Windsor plant, leaving the decision on a new operator to the Corporation and Christie administration.

“The situation is still crystallising; the Government hasn’t made a decision yet,” Mr Demeritte told Tribune Business.

“But we are very optimistic as a Bahamian group that we can offer the best cutting edge solution for the country and for Windsor.”

While exempting the Water & Sewerage Corporation from his remark, Mr Demeritte said EPS Consultants wanted the process to be “more transparent”.

Tribune Business understands that Consolidated Water is preventing the group and its advisers from inspecting the Windsor plant, on the grounds that this would benefit a direct competitor.

Still, Mr Demeritte added: “The Bahamian group is confident its pricing and technical capabilities are fare superior to what is being currently offered.” It is understood that the group would look to cut water supply costs within 18 months of taking over.

Describing EPS Consultants as “a cross-section of Bahamians”, Mr Demeritte divulged that it also included Robert Wells, a former Water & Sewerage Corporation deputy chairman. The group is also understood to include prominent Bahamians from the financial and political worlds.

Meanwhile, the former Water & Sewerage Corporation chairman told Tribune Business that EPS Consultants’ proposed price point at which it would sell to the Corporation included the full cost of its planned investments to “modernise and upgrade” the Windsor plant.

“Our reduced costs include the investment, retrofitting and modernisation of the plant,” Mr Demeritte said. “We believe the margins there currently are extremely high.”

Apart from reducing the price paid by the Water & Sewerage Corporation, he added that EPS Consultants would bring in a new, all-Bahamian management team and ensure all existing jobs at Windsor were preserved. One or two new posts might also be created.

Mr Demeritte also hit out at Consolidated Water for having an effective monopoly on the New Providence wholesale water supply system, via its Blue Hills plant and existing Windsor lease.

It also sought to enter into a 50/50 joint venture agreement with the New Providence Development Company to supply water to the western side of the island, a deal that for the moment has been thrown into turmoil by the Water & Sewerage Corporation’s withdrawal of approval,.

Suggesting that EPS Consultants’ 100 per cent Bahamian composition also gave it an edge, Mr Demeritte added: “We have seen growing up under our noses a monopoly, and a monopoly is never good for business.

“There is no competition, and no balance to the system. Full and proper Bahamian ownership is long overdue.”

Rick McTaggart, Consolidated Water’s chief executive, disclosed in March that consolidated Water was seeking a five-year extension of its supply agreement with the Water & Sewerage Corporation for the Windsor plant.

“The Windsor contract is set to expire in mid-May when we reach the contracted delivery volume of 10.75 billion imperial gallons of water over the last 15 years,” Mr McTaggart told Wall Street analysts in a conference call.

“We’ve submitted a proposal to the Corporation in October last year to extend the contract for an additional five years, and we’re awaiting its decision.

“In the event the Corporation decides not to extend the contract, then we would enter into negotiations to sell the plant and equipment to the Corporation, and lacking any agreement on the sale we would remove the plant and the equipment from the site.”