Rigs and tadpoles to bring growth as water business stagnates -Veolia

Reuters

By Geert De Clercq

PARIS, Feb 6 (Reuters) - Veolia Environnement is seeking growth in dismantling oil rigs, tracking endocrine disruptors with tadpoles and recovering copper from mining waste water as its traditional water business stagnates, its chief executive said on Thursday.

With a two-year cost-cutting and debt-reduction plan largely done, the water, waste and energy group is targetting areas with high growth potential, Antoine Frerot said.

The group is investing heavily in toxic waste treatment, dismantling oil rigs and nuclear plants, waste management for the agrifood sector, water treatment for the mining industry and environmental services for the oil and gas industry, he said. Recycling and urban services are also in the frame.

"Each of these sectors have huge potential and we expect markets of several billions of euros and for some tens of billions," Frerot told a briefing about corporate strategy.

Its traditional water business, which still represents 47 percent of its sales, is under pressure because of Europe's economic slowdown, regulatory limits on concession length and increasing preference for municipal ownership of water networks that saw Veolia lose its landmark Paris concession in 2010.

At each contract renewal in its French domestic market, where it generates 50 percent of revenues, Veolia faces pressure on tariffs and has to accept shorter contracts, and is increasingly targetting industrial clients to counter that.

Frerot said once Veolia's Dalkia energy services joint venture split with France's EDF is finalised towards the end of 2014, it will incorporate Dalkia's international activities and offer its services under the Veolia brand.

Energy services will then make up 21 percent of sales, after water at 44 percent and waste at 35 percent.

Frerot said that dismantling oil and gas rigs worldwide is a major business opportunity for the group, as in the coming decade some 2000 oil platforms need to be dismantled in the North Sea, the Gulf of Mexico and Southeast Asia.

With a cost of up to 100 million euros or more per platform and with dangerous waste including radioactive residues from oil drilling, Veolia says it is one of the few companies with the skills for these major projects.

In the past six years, Veolia has dismantled six oil platforms in the North Sea for customers including BP, Total, ConocoPhillips, Hess and Royal Dutch Shell, Veolia Northern Europe director Estelle Brachlianoff told Reuters on the sidelines of the briefing.

"We have many more projects in the pipeline, we are very confident about this business," Brachlianoff said.

In its traditional water recycling business, Veolia needs to innovate to stay ahead, Frerot said, and Veolia's Vilvoorde, Belgium plant was at the forefront of several new technologies.

Bacteria recuperate plastics from the plant's waste water effluent and Veolia uses tadpoles to identify endocrine distruptors in the water, he said.

Veolia Water director Klaus Andersen told Reuters that Vilvoorde uses a biological process under which bacteria excrete polymers which are then turned into plastic.

"If you stress the bacteria in a particular way, they build up polymers in their cells," he said.

Mining and the oil and gas sector also offer Veolia high growth opportunities, Frerot said, as both use huge quantities of water, from which Veolia recoups minerals before recycling.

Veolia recovers about three percent of the copper in the waste waters of the Codelco mine in Chile, he said.

Frerot said that the restructuring programme of the past two years was now mostly complete and said Veolia had sold about 6.3 billion euros worth of assets in 2012-2013.

"We have sold most of these assets on avearge at more than ten times core earnings, despite the crisis," he said.

Frerot also confirmed that the company's net financial debt level stood at between 8 to 9 billion euros at the end of 2013, in line with its objectives, from 9.6 billion in september.

"In four years, we have divided our debt in two," he said.

Veolia releases 2013 earnings on Feb. 27.

Rates

View Comments (0)

Recommended for You

  • Tycoon buys 30 Rolls-Royces for Macau hotel

    A Hong Kong tycoon has placed the biggest ever order for Rolls-Royce cars, agreeing to buy 30 Phantoms to chauffeur guests at a luxury resort he's building in the global gambling capital of Macau. Stephen Hung's $20 million purchase surpasses the 14 Phantoms bought by Hong Kong's Peninsula Hotel in…

    Associated Press
  • Enjoy this refreshing Triple Play offer!

    Get FIOS TV Mundo starting at $79.99/mo. w/ no annual contract + 2-yr. price guarantee. Or sign for 2 yrs. & get a $300 prepaid Visa. Click here.

    AdChoicesVerizon FiOS ®Sponsored
  • Tycoon's arrest sends shock wave through Russia

    Tycoon's arrest sends shock wave through Russia MOSCOW (AP) — The arrest of a Russian telecoms and oil tycoon has sent shock waves through the country's business community, with some fearing a return to the dark days of a decade ago, when the Kremlin asserted its power by imprisoning the country's…

    Associated Press
  • Before You Buy Alibaba, Check Out 4 Top China Stocks

    Before You Buy Alibaba, Check Out 4 Top China Stocks While investors gear up for Alibaba Group 's (BABA) hotly anticipated initial public offering, don't forget about other Chinese stocks that are worth keeping an eye on. Today's Young Guns Screen of

    Investor's Business Daily
  • Costco Stores in Canada to Stop Taking American Express

    “The credit card relationship between American Express and Costco Wholesale Canada will not be renewed when it expires” on Dec. 31, the company said today in an e-mail to Canadian customers. The message was attributed to Lorelle Gilpin, vice president of marketing and membership for Costco…

    Bloomberg
  • Play

    Citi, Bank of America Offer Discounted Mortgages

    Citigroup and Bank of America will offer mortgages at discounted interest rates to help borrowers with low incomes or subprime credit. AnnaMaria Andriotis joins MoneyBeat. Photo: Getty.

    WSJ Live
  • "The Retiree Next Door": How successful retirees stretch their savings

    "The Retiree Next Door": How successful retirees stretch their savingsBy the time she hit her late 40s, Toni Eugenia wasn’t sure she would ever be able to retire. Eugenia, 56, a pharmacy technician who lived in Houston, was nearly $200,000 in debt and

    Yahoo Finance
  • As Fed takes baby steps, Cramer's trick for profit

    In turn, Cramer says making money in the market, involves looking at the environment through the lens of the Fed. "The trick is to remember that they speak for the common person," Cramer said. "The Fed wants the common person to make money." With that backdrop always in mind, Cramer says it becomes…

    CNBC
  • Accomplish your career goals

    At Capella University, you can learn the skills you need to succeed. Why wait another day? Get started today.

    AdChoicesCapella UniversitySponsored
  • CNBC Anchor Calls Out Fed-Hater Bill Fleckenstein In Startling Shouting Match

    CNBC Bill Fleckenstein of Fleckenstein Capital appeared on CNBC's Futures Now program on Tuesday. Futures Now host Jackie DeAngelis came out swinging, asking Fleckenstein right at the top if he was willing to admit that he had misunderstood monetary policy. Sounding taken aback, Fleckenstein…

    Business Insider
  • Beanie Babies creator's sentence debated in court

    Beanie Babies creator's sentence debated in court CHICAGO (AP) — Federal prosecutors seeking to put the billionaire creator of Beanie Babies in prison for hiding millions in Swiss bank accounts told appellate court judges Wednesday that the toymaker's sentence of probation threatens to erode the…

    Associated Press
  • Apple to unveil new iPads, operating system on Oct. 21 : report

    The company plans to unveil the sixth generation of its iPad and the third edition of the iPad mini, as well as its operating system OS X Yosemite, which has undergone a complete visual overhaul, the Internet news website said. Trudy Muller, a spokeswoman for Apple, declined to comment. The iPad is…

    Reuters
  • Gilead Stock Is Falling On These Drug Setbacks

    Gilead Stock Is Falling On These Drug Setbacks Gilead Sciences (GILD) shares are backsliding Wednesday on news that the patient drop-out rate for hepatitis C drug Sovaldi is quadruple that of clinical trials. In addition, the biotech's Phase 2 study results

    Investor's Business Daily
  • Here's What Mark Cuban Wishes He Knew About Money In His 20s

    Cuban is the owner of the Dallas Mavericks basketball team. Billionaire investor and entrepreneur Mark Cuban is generous with his advice. When we asked him what he wishes he'd known about money in his 20s, he said:

    Business Insider
  • Play

    What the Fed Meeting Means for Bonds

    Janet Yellen & Co. are expected to hint at their timetable for raising interest rates. Here's how investors should prepare ahead of the meeting.

    WSJ Live
  • 1 Tip To Lose Belly Fat

    It's Hollywood's Hottest Diet And Gets Rid Of Stubborn Fat Areas Like Nothing Else.

    AdChoicesagoodcooksSponsored
  • Margaritaville casino owners seek bankruptcy

    The owner of Biloxi's Margaritaville casino has filed for Chapter 11 bankruptcy protection Tuesday, only hours before a hearing where the landlord aimed to seize the property. The filing by MVB Holding LLC in U.S. Don Dornan, a lawyer for landlord Clay Point LLC, said the company had planned to ask…

    Associated Press
  • Embraer to sell 50 E-175 jets to Republic in $2.1 billion deal

    Brazil's Embraer SA, the world's third largest commercial planemaker, said on Wednesday it booked a firm order from U.S. The deal, which will be included in Embraer's order book for the third quarter, is valued at $2.1 billion, the planemaker said in a securities filing. The planes will be operated…

    Reuters
  • SHOE COMPANY: Our CEO Just Disappeared And Most Of The Money Is Gone

    "and like that: he's gone." This is an actual headline from a company press release: "CEO and COO disappeared, most of the company's cash missing." (Via FastFT) In a statement, German-based shoe company Ultrasonic said its CFO,  Chi Kwong Clifford Chan, has been unable to reach the company's CEO,…

    Business Insider
  • Don't buy Alibaba stock: 'Dean of Valuation'

    Investors should steer clear of Alibaba , valuation expert Aswath Damodaran said Wednesday. On CNBC's " Fast Money ," Damodaran, a professor of finance at New York University's Stern School of Business, noted that he was looking at Alibaba stock from the perspective of a long-term investor, not a…

    CNBC
  • Billionaire Investor Says Chinese People Work Harder And Western Companies Could Face Deep Trouble After Alibaba IPO

    Michael Moritz, the chairman of VC firm Sequoia Capital, is a huge fan of Chinese internet companies and reiterated his enthusiasm for the Chinese market in an interview with The Wall Street Journal Wednesday. The billionaire investor described the Alibaba IPO as a “major landmark event” that is as…

    Business Insider
  • Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More

    Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More Stocks were firm on Wednesday morning ahead of the FOMC meeting outcome. Tuesday’s rally may have sparked higher interest again, and investors are looking for bargains

    24/7 Wall St.
  • Norwich Information Security MS

    Online, accredited, top ranked. NSA Center of Academic Excellence. Recognized by the Department of Homeland Security. Download your free brochure!

    AdChoicesNorwich UniversitySponsored
  • Play

    Tues., Sept. 16: Watch Humana Stock

    Humana, Global X Social Media Index ETF and Majesco Entertainment are among stocks to watch. WSJ's Chris Dieterich discusses the details with Michael Casey. Photo: Humana

    WSJ Live