Trip Report, Italy 1996

Trip Report, Italy
between January 29 - February 2, 1996
Together with
Rich Killion, Department Chief of B&W HRSG Barberton Ohio USA,
Don L.McKenzie, Expatriate General Manager of BWG, Ankara Turkey

January 28,1996 Hotel Cavour in Milan at 18:00 hours

We gathered in the Hotel Cavour lobby in Milan on January 28,1996 evening together with Mr. PierFrancesco Rimbotti.

We planed our game plan how to respond to our hosts in the meetings scheduled throughout the following week in Italy. We agreed that initially Francesco should explain B&W and its Italian Rep Sepro in general, utility, HRSG and package boilers, past B&W experiences and references in Italy, relationship with licensee Ansaldo, broad perspective of B&W's future expectations in Italian market, B&W's new hot product HRSG, B&W design capabilities, six joint venture companies strategically located in the world, nearest one BWG in Ankara, its geographical closeness to the subject market, Turkey's new involvement to European Customs Union which creates B&W/BWG's keen interest to work in Italian and European market, all these to be accomplished by forming strategically sound partnerships. Rich was responsible to explain B&W Barberton design modular, horizontal gas flow, natural circulation HRSGs, past experience, third generation design and its recent references, design advantages, how to handle shorter erection. Then DLM with assistance of HD was responsible to explain the competitive advantage of utilizing nearest B&W joint venture in Ankara, how it was formed, how close it is to Italy, how competitive its prices would be etc.

We agreed that our marketing strategy has to emphasis advantages based primarily on location dictated, then technology dictated. HRSG's easy contractibility in the nearest joint venture facility in Ankara, latest design which allows short erection period at site, overall mechanical productivity. We had to emphasis importance of technical personnel to be located in Milan (in future), more PR, and confidence building, B&W's technical office in London/UK, contact office in Milan/ Sepro. B&W Barberton will provide technical support to BWG for Italian projects. This arrangement offers an economically priced HRSG with the latest technology, with each project optimized for the highest efficiency.

Meeting with Snamprogetti in their head office at "20097 S.Donato Milanese" on January 29,1996 between 10:00-12:00

We met in Snamprogetti with following persons, all in Energy Package Section, Packaged Systems & Furnaces
Ferruccio Frangi, Group Leader
Franco Grinzi, Manager
Giovanni Carbotti
Eugenio Nichelini,

In our meeting, we explained B&W and its nearest joint venture BWG capabilities, their advantages to work with us, our keen interest to cooperate with Snamprogetti in Italy and/or other parts of the world. In return, they explained that they are interested in B&W design HRSGs, other boilers and E/P. They have one project in Sardini island with El-Paso type boiler. They have limited interest in FGD since they have their own design to implement when needed. That is promoted by Topsoe of Holland which is 50% owned by Snam. They have one pilot FGD plant in Sicily island. Enel has a number of FGD projects, one of them installed in Brindisi. Snam estimated that a turnkey site erected HRSG scope for Frame-9 could cost 12 billion Liret, whereby shop assembled may cost 9 billion Liret. We expect HRSG scope fabricated and delivered by BWG, 4 billion Liret FOB, 6.6 billion Liret assembled. Snam recommends that similar project may cost 3.5 billion Liret. That is reasonable Market price in Italy. In North America it may cost 3 million USD, whereby BWG may deliver for 2.3 million US Dollar. Coen, John Zink duct burners are acceptable in Italy, and generally preferred. Rich explained that the one he explained site erection in detail, has been delivered in 4.5 month including delay in inlet duct. Right now, Snam explained that they are promoting one Frame-6 and one Siemens, two Frame-9E units (tar gasification with GE) in Italy. Furthermore we have been informed that there are following partnerships in Italy Standard Fasel/Vogt Maggi/Nooter Higgiotermeggi (has own design) Babcock Enterprise / France (own design) Belleli (financially insecure) Ansaldo (own design for Siemens V92, modular structure) They need HRSGs mostly for Frame-6 size. They had cooperated with FW in North America, and with ABB-CE in Pakistan in a number of projects. Our cooperation with Sondel is a very good opportunity to understand Italian market. They may need to source single drum boilers with 300,000 pph (136 tph) steam output capacity at 130 bar/ 520-530C. These projects are Ammonia and Urea Complexes firing primarily naturalgas. Wide range of chemical operation may be applicable in their projects. Snamprogetti has not been able to find single drum boilers at this capacity, but are familiar with two drum units from B&W and CE. They prefer single drum. Their application is a new or rare boiler requirement for high pressure industrial gas fired boilers. They have done several ammonia plants outside Italy and expect 4 to 5 per year. Boilers are included in their scope for such plants. They completed one in China and are bidding on one in Venezuela. We have a reference list.

Meeting with Sondel & engineering company Protecma in their Milan office on Monday

We met with
Roberto Tellarini, Direttore, Sondel Marketing Strategigo
Bruno Covili Faggioli, General Manager, Protecma
Dott.Ing.Giovanni Trombetti, Ingegneria Impiantistica, Protecma
Dott.Ing.Franco Meroni, Ingegneria Impiantistica, Protecma

We had same presentation. In return they explained that Protecma is an engineering company 100% owned by Sondel. In Italy they have two plants in operation, four plants in construction and two plants in project development stage.

Meeting with ENEL (in various instances three times in Milan and Roma).

We met with
Angelo Benanti, Manager Mechanical Design Group
Dott. Ing. Pietro Todisco
Mario Pastorino
Alberta Scerrati

After delivering our almost standard presentation, we have received following outcome from our hosts. A nearby B&W JVC, supported by parent B&W technology is a good opportunity to reduce overall costs and be competitive in Italian and Italian influenced markets. They have Repowering, revamping, retrofit projects whereby Environmental Impact Study of local administrations are very important in execution of the power projects. La Spezia Power Plant project. Existing coal fired B&W power boiler will be dismantled then new vertical forced circulation type HRSG will be installed into available space. HRSG with 3-pressure level. No condensate preheater. structural modifications are carried out at this time by ENEL design office. Boiler is top supported. GT will be Frame-9F. HRSGs will have two pressure levels. No additional foundation, or steel structure will be necessary since existing units will be used. Available space is the governing parameter. La Spezia plant will have 2x220MW GT coupled with 2XHRSG, plus 1 each steam turbine 320 MW MCR with reheater. There will be also an FGD project, for Units 3 & 4 expected to be tendered soon. Prequalification may be ended. Better to check in written, notice of tender. Trina plant is new, built by Ansaldo under Mitsubishi technology. 2X 120 MW GT plus 1x110MW ST, 2XHRSG 60 bar HP for HP, 6 bar for deaerator. Prequalified competitors in 1992 are Ansaldo (with Mitsubishi), Belleli (with NEM), F&W (Italian), Deutsche Babcock (with Turbotechnica). Pietrofiatta Project is coal firing FB design. It is on hold due to local administration regulations although project is feasible. They were talking about future projects Frame-9E, which could be ordered in 1996. In Vadolugira, FGD by Ansaldo with Mitsubishi technology received the order. We have been informed that all new tenders are to be announced in European Community Official Tender Journal (Bulletin) in order to give equal opportunity to all interested parties. Its Italian name is "Gazetta Ufficiale Della Comunita Europe". It will be good to review that journal continuously in order to find boiler opportunities in European Market. ENEL is in privatization scheme, and therefore they are interested in working together with all competitive parties. They are currently working in Ghana, Kampuchea, India as A/E company.

Meeting with Technimont in Milan on Monday at 17:00 hours

Participants on behalf of Technimont Francesco Ferrara, Heater Group Supervisor, Vessel & Heater Department Marco Blasioli, Engineer, They are specialized in turn-key construction of PTA plants around the world. They need process steam which is normally supplied by the client from existing power house.

TPL, Tecnologie Progetti Lavori Spa
with their partner IEMSA Company in Roma on Tuesday

TPL Participants were
Dott.Ing.Gaetano Zappulla, Vice- President Business Development
Dr.Ing.Riccardo Pascoli, Environmental Engineering Manager
Dott.Ing.Fernando Beghetto, Senior Quality Engineer
Lucis Flammini, Technipetrol (absent but should be contacted) 06/65985346
Ing.Vittorio Papagno, Amministratore Delegato IEMSA Impianti srl

We have been informed that Iemsa is a general contractor for site installation of power plants. They have many references in site installation of B&W design Ansaldo power plants in Italy for ENEL. They worked in Egypt for building power plants for Ansaldo then for Deutsche Babcock, UDE etc. Ansaldo plant in Tunis 2 x 170 MW with Russian and Portugal labours. We have evaluated our past joint proposal to Termica Cologno of Sepro, where Iemsa was general contractor, ENEL handling engineering, BWG was supplying HRSG for LM6000 gas turbine. Order is received by Nooter but that helped us to understand how to cooperate and work together in similar projects in future. TPL is formed in 1969 and restructured in 1995. TPL is an engineering and contractor company especially in building Refineries and similar Petrochemical installations. It is 95% owned by French Technip Group. TPL is building food, textile and light industrial installations. Moreover they work for infrastructures, state railways for High Speed Trains (We experienced, it is fantastic, fast, comfortable, and reasonable priced). They provide PM service for high speed railways construction, energy, environment and other infrastructure projects. They have detail engineering services. Certified to ISO-9001 by Bureau Veritas. In 1995 they were divided into two, TPL and Technipetro. Almost 800 personnel is working for Technipetro. TPL is active in South America, China and Middle East, Malaysia. They completed one PTA project with Amoco in Georgia USA. They have offices in Moscow and St.Petersburg. They look for strategical partnerships with competitive partners case by case basis.

Turbotechnica in Firenze on Wednesday
Participants were
Maurizio Amerini, Proposal Manager Power Plant & Cogeneration
Nicolo Gargini, Proposal Manager Power Plant & Cogeneration
Dino Catastini, Applications and Sales Manager, Power Plant & Cogeneration
Dr.Ing.Guelfo Gheri, Direttore Commerciale
Tarik Bayazit, GE Power Systems Istanbul
Dr.Peter Brown, GE Power Systems Istanbul

We generally reviewed ongoing important projects which we cooperate exclusively. Glassworks 2xPGT10 +2XGTWHRSG +2XGFWHRSG design is reviewed. GT and ST detail drawings received. Commercial issues reviewed. Bid date extension until March 11,1996. In the last period of our conversation, Dr.Ing.Guelfo Gheri, Direttore Commerciale joined us and expressed his positive expectations for future similar projects which we hope to cooperate. They indicated that they sell 8-10 GT projects per year, 4-5 of which require HRSG's in BWG's size range. They are looking for new partners.

Frene in Milano on Thursday

Participants were
Ing.Settimo Loforti, Direttore Technico e Attivita Operative
Ing.Fausto Ermolli, Responsabile Tecnologie e Sviluppo
Ing.Marco Gentili, Responsabile Processo e Coordinamento Produzione

They expressed their interest to work together in future if they install gas turbines into their plants. They had a rehabilitation study for a power plant in Sardine island. 4x600 tph steam boilers capable of firing oil and gas are installed but not operated until now. No steam turbines are installed. They need 4x70 MW steam turbines. Rich explained them that HRSGs can be FOB delivered in 10-12 months plus 2-5 months for site installation should be additionally considered. Normally Steam Turbine is on the critical path of a combined cycle power plant. ST needs special fabrication initiated only after order. They build Petrochemical plants. Steam is very important for their process. Low NOx emission regulations will be effective after January 1,1998. They will be in need of efficient Low- NOx burners. They want to demolish existing old steam boilers and install new Frame-9 plus HRSG + ST combined cycle power plants. They want to generate maximum energy and sell to national grid. (now 50 MW, 200MW in future). They are in ENI group, and under privatization. First boiler unit in Ravenna Petrochemical plant is out of operation due to irreparable cracks in the drum. They want to demolish the boiler and install new Combined Cycle power plant.

Edison in Milan on Friday

Participants were
Ing.Bruno Cavazzana, Coordinamento Investimenti Strategi
Ing.Enrico Malusardi, in charge of engineering
Ing Maurizio Malusardi, in charge of Electrical engineering
Ing.Luigi Orsenigo, in charge of purchasing
Cesare Antonini, Mechanical & Process Design Manager
Simone Simonetti, ILVA Servizi Energie

They are an IPP company in Italy, We explained our capabilities. They were interested in our presentation. We emphasized that we are available to serve them in their existing and new power plant projects, whichever arrangement would be suitable for them, by furnishing full design coverage from North America and available competitive overall prices created by utilizing nearby joint venture facilities. Edison has three following current projects, - Combined Cycle, 100MW, 2xLM6000, offers are received. In evaluation. - Combined cycle, 2 projects in development in Italy Frame-9, 140MW basic engineering ongoing, 1xGT + HRSG, no by-pass stack - River Po, 50 km far from Milan, waiting local authorization - Central Italy, Verona, waiting local authorization

Summary

In summary, we can conclude that there is general interest in B&W products in Italian market, and specific interest in more economical soulution for supplying the fabrication from JV in Ankara under B&W's engineering coverage. There are business potential in Italy for B&W and BWG's interest. We can work with and/or for Italian companies in or outside of Italy in a number of projects, together with other B&W JVs if necessary due to geographical position of the final destination. These meetings gave us an initial feeling that they are interested in our products, in our approach to deliver economically feasible final product, and we are ready to serve for them. Final evaluation is that we should have more emphasis on Italian market to promote B&W industrial products. That needs more contacts in the market, more support to Milan Sepro office. We need to bring together other follow-up ideas expected to be generated by B&W (R.Killion), and Sepro (P.F.Rimbotti).

Compiled on February 10, 1996