THE ECHO - Ferrostaal

SUMMER ISSUE 2006
THE ECHO
THE CORPORATE MAGAZINE OF THE MAN FERROSTAAL GROUP

Dear readers,
Growth in global markets has really accelerated over the last few
years. And MAN wants to be part of this action. MAN Ferrostaal has
a key role to play in this regard and will continue to spur on the
globalization of the MAN Group.
Our company has traditionally had a very strong global presence.
We are represented in 60 countries around the globe, with almost
half of our workforce employed in subsidiaries and offices outside
of Germany. In future, we want to use this global presence to make
the products of the MAN Group and its affiliated companies available
more systematically to customers the world over. We are particularly
determined to do so in countries where access to MAN products
is currently difficult or even impossible.
As a sales and service platform for the MAN Group, we will intensify
and systemise activities that MAN Ferrostaal has been performing
for many years but in a selective fashion only until now. We have
already collaborated with MAN Diesel for many years on selected
projects in the area of power plants and commercial ships. We also
represent MAN TURBO in 20 countries. In a number of instances, we
have assumed responsibility for the sale and distribution of MAN
Busses.
In future, we want to expand our sales and service platform in the
areas of MAN commercial vehicles, diesel engines and turbomachines.
We will focus in particular on South America, the Near
and Middle East and South-East Asia. Concrete examples of our
efforts are to be found in this magazine.
All of this is closely connected to our expertise in offset (countertrade)
activities, which we want to exploit to a greater degree for
Group projects going forward. Wherever the MAN Group collaborates
with state-owned customers, we can fulfil any of the countertrade
obligations that frequently form part of these contracts. We
also plan to offer our expertise in this area, which only very few companies
can rival, outside of the Group. You will also find a current
example of this in this issue.
Yours,
Matthias Mitscherlich
THE ECHO 1/2006 3
editorial
Dr. jur. Matthias Mitscherlich,
Chairman of the Executive Board
at MAN Ferrostaal AG

4
contents
22
14
50
42
standards
03 EDITORIAL
04 CONTENTS
61 TRADE FAIRS 2006
61 PUBLICATION DETAILS
61 READER SERVICE

forum
6 THE HUB OF THE MAN GROUP
MAN Ferrostaal consolidates group activities to
systematically open up greater market potential.
14 “RESTORING SOUTH AFRICA’S LOST INDUSTRY”
Platforms for Africa’s oil and gas industry.
projects & contracting
18 OFF TO A GOOD START IN OMAN
The “Trinidad Model” is transferred to Oman.
20 CLEAN AND EFFICIENT
First turnkey power plant project is completed
in Germany.
22 PULP: A PRODUCT WITH PROSPECTS
New momentum for the plant construction business.
26 A NEW LEASE OF LIFE IN PERU
Renovation of a hydroelectric plant
28 READY FOR BLASTING
New blast furnace is completed for Arcelor-Mittal.
32 IRON ORE PELLETS IN GREAT DEMAND
Mauritania is full of promise for MAN.
34 SAFETY ON THE HIGH SEAS
MAN Ferrostaal is meeting the growing demand for
tanker tonnage with “the safest tankers in the world”
37 BUILDING SHIPS WITH THEIR OWN STEEL
Construction of a new plate mill in Vietnam.
38 GYPSUM BOOM IN ASIA
Production Plants for Gypsum Plaster Boards
40 INTO THE DESERT
Maintenance of a natural gas plant in Libya
services & logistics
THE ECHO 1/2006 5
41 SEVEN AT ONE STROKE!
High-tech machines for producing multilayer film
42 BROWN GOLD FROM GHANA
Investment in cocoa processing plants promises
large profits.
44 LEADING COLUMBIAN PRINTER GOES LARGE
Latin America as a strong market with prospects
46 UNBEATABLE FOR SMALL PRINT RUNS
Technological advances with the ROLAND 500
48 “WE HELP KEEP OUR CUSTOMERS PROFITABLE”
MAN Ferrostaal is the world’s largest independent
service provider in the printing industry.
financing
50 A MODEL FOR SOUTH AMERICA
Financing solution for a petrochemicals plant
receives recognition
54 “WE COMBINE FINANCING AND OPERATIONAL RESPONSIBILITY”
An interview with Jens Gesinn, Board Member for
Finance, Accounting and Controlling
57 SUPPLIER CREDIT OFFERS LOWER INTEREST RATES
Simple and Inexpensive
news
58 NEWSFLASHES

6
forum
MAN FERROSTAAL LEVERAGES SYNERGIES IN THE MAN GROUP
THE HUB OF THE MAN GROUP
MAN Ferrostaal is building a sales and service platform for the MAN Group. In collaboration with other affiliated companies in the
MAN Group, the company wants to make the products of the Group more readily available to customers across the globe, and is
using its international sales and service platform and its financing expertise to do so.
01

02
“The MAN Group has a fantastic range of products. However,
customers in many countries simply have no access to them. We
want to work systematically to make this access possible”. This is
how Dr. Matthias Mitscherlich, CEO of MAN Ferrostaal, describes
the company’s most important strategic development goal. This
will necessitate tapping into the potential synergies within the
MAN Group. These include valuable industrial products and a
presence in many different countries on the one hand, and solid
options for financing on the other. MAN Ferrostaal will strive to
systematically consolidate these strengths in the future.
“We will exploit our international sales and service network to
open up new market potential in collaboration with other affiliated
companies in the MAN Group,” says Mitscherlich. “We will do so in
particular in countries where we have forged strong connections
going back many years.” This is particularly true of Latin America,
the Near and Middle East and South-East Asia.
01. Commercial vehicles: MAN Ferrostaal looks after sales and service in
selected countries in Latin America and South-East Asia.
02. Diesel engines: MAN Ferrostaal and MAN Diesel are entering into a joint
venture for the construction of diesel power plants.
THE ECHO 1/2006 7
>>>Strong starting position. MAN Ferrostaal has already been
working in collaboration with sister companies within the Group
for many years. For example, it acts as an agent for MAN TURBO in
20 European and Latin American countries. In addition, it regularly
uses turbines and compressors manufactured by its sister company
from Oberhausen in its large industrial plants. MAN Ferrostaal
represents MAN Diesel in countries including Chile, Mexico,
Venezuela, Peru, Columbia and Ecuador. While the company has
occasionally sold MAN commercial vehicles, its closer collaboration
with MAN Nutzfahrzeuge is a relatively new venture. Only in the
past two years has MAN Ferrostaal entered into the Mexican bus
market, in collaboration with MAN Nutzfahrzeuge.
“Our priority is to bundle, systemise and enhance our shared
activities within the Group” says Mitscherlich. “We want to
expand the business we do with products from other MAN
companies from its current value of 300 million euros to more
than 1 billion euros per year by 2010.” This will be achieved
through the new sales and service platform that is being established
by Dr. Klaus Lesker, who has been a Member of the MAN
Ferrostaal Executive Board since May 2006.

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forum
01
02
01. Turbines and compressors: MAN
Ferrostaal acts as an agent for MAN
TURBO in 20 countries in Europe and
Latin America.
02. Printing presses: MAN Ferrostaal manages
sales and service on behalf of MAN Roland
in the southern hemisphere.

Collaboration with MAN Diesel. A key element of the MAN sales
and service platform is a joint venture with MAN Diesel, which
will be established later this year. This company will be dedicated
to the construction and sale of diesel power plants. As a general
contractor in plant construction, MAN Ferrostaal has been building
high-performance power plants driven by gas and steam turbines
for many years. The new joint venture will help to systematically
utilise the strengths of the two sister companies (namely, their
products, a sales organisation with project development expertise,
and project management) with a view to opening up new markets
in this area. The long-term goal of the joint venture is to achieve
market leadership in stationary diesel power plants.
>>>Global strength. MAN Ferrostaal’s strong global presence forms
an essential pillar of the new MAN sales and service platform. “We
have offices in more than 60 countries and 40 percent of our
employees work outside of Germany”, Mitscherlich points out. “It
is only natural that we are particularly interested in developing
our business relationships in countries where our sister companies
are not represented by their own overseas organisations.”
In conjunction with the new MAN sales and service platform, new
MAN offices are to be opened in Peking, Dubai and Teheran, for
example, for which MAN Ferrostaal will be responsible. These
MAN offices will prepare the ground for the opening up of greater
market access for MAN Group products in the regions in question.
The MAN office in Dubai is set to open at the start of 2007, and the
offices in Peking and Teheran will follow.
>>>The pioneering Grupo MAN en México. The subsidiary MAN
Ferrostaal México represents all companies affiliated to the
MAN Group in the Central American country, namely MAN
THE ECHO 1/2006 9
Nutzfahrzeuge (trucks and busses), MAN Diesel and MAN TURBO.
In addition, MAN Ferrostaal México takes care of MAN Roland’s
printing press business locally. Stefan Deuster, Director of the subsidiary,
therefore refers to a Grupo MAN en México: “Our trading
volume for core products amounted to 135 million euros in 2005,
with the commercial vehicles sector showing the greatest potential
for growth. By 2010, we expect revenue in this area to reach
some 250 million euros.”
MAN has been represented in Mexico since 1904 (initially as the
Gutehoffnungshütte group). Key MAN Ferrostaal projects in
Mexico have been in the area of transport and infrastructure,
such as the building of trains for a light-rail system in Mexico
City, Monterrey and Guadalajara, and plant construction for the
steel industry. Projects in energy, machinery and printing came
later. One high-profile project for the past five years has been the
delivery of compressor plants from MAN TURBO, which are used
for oil production in the Gulf of Mexico. They compress nitrogen
in the oil and gas fields to facilitate the production of oil and
natural gas.

10
forum
01 02 03
04
01. Almost all of MAN Ferrostaal
México’s employees are
Mexican.
02. Stefan Deuster, Director of
MAN Ferrostaal México.
03. Stefan Deuster says of his
employees in bus production:
“Without their huge dedication,
our success would
not be possible.”
04. Production plant in Qurétaro:
This is where busses are
assembled for the Mexican
market.

Getting into the commercial vehicles business. Since 2004, MAN
Ferrostaal Mexico has also been involved in the assembly and
distribution of commercial vehicles for MAN Nutzfahrzeuge. The
Mexican subsidiary of MAN Ferrostaal has become general agent
on the ground for MAN Nutzfahrzeuge. The company is therefore
responsible for sales and distribution, spare parts and service for
MAN trucks and busses in Mexico. According to Deuster: “We
manage sales and service from our existing locations in Mexico
City, Querétaro and Guadalajara. In the next year and a half, we
will also expand our sales and service network across the country
to include 16 key sites, plus certified independent partners.”
It all started with the assembly of busses and bus chassis, which
MAN Ferrostaal began in Querétaro in 2004 and has continued to
do ever since. In future, the busses will be manufactured under
the direction of MAN Nutzfahrzeuge and will be distributed by
MAN Ferrostaal. For the time being trucks will continue to be
imported in parts or as finished products and sold locally.
“We entered the Mexican bus market in 2004 and there are now
approximately 1,000 MAN busses in operation in the country”,
says Deuster. “Demand is high because there is no rail network in
Mexico. We therefore want to increase this number significantly
in the coming years. Our target for 2010 is to achieve sales of
1,000 busses and 1,000 trucks per year. In the long term, we want
to use our base in Mexico to break into other markets in Latin
America.” The signs are looking good. Today the company has a
market share of 40 percent of registrations in the top segment for
bus chassis, and has been market leader in Mexico since starting
production there. At the start of June, MAN Ferrostaal Mexico and
MAN Nutzfahrzeuge jointly opened a new production site in
Querétaro, which will quadruple production capacity.
THE ECHO 1/2006 11
>>> JUST TWO YEARS AFTER
ENTERING THE MARKET, THERE ARE
ALREADY MORE THAN 1,000 MAN
VEHICLES IN THE COUNTRY.
>>>MAN customer par excellence. The medium-sized Mexican
printing company Papel, Cartón y Derivados (PCD) in Celaya,
Mexico, was established in 1997 and has become one of MAN
Ferrostaal México’s major customers. The company is the countrywide
market leader in the area of printed corrugated cardboard
and flexo print. Within a very short space of time, PCD has earned
a reputation for high quality and reliable just-in-time delivery.
This means that PCD products are in demand. Owner/manager
Refugio Gonzalez believes that the company has the potential to
become a major player in the offset printing market. (See the article
entitled “Thinking Outside the Box”). But first PCD must expand.
This in turn requires considerable investment. Gonzales is therefore
pursuing an ambitious expansion plan.
He has already ordered an extensive package of printing technology
with a tailored credit financing solution from MAN Ferrostaal and
plans to expand PCD’s fleet of 126 trucks with 20 TGA trucks from
MAN. MAN Ferrostaal Mexico will handle the sale and execution.
This will make PCD the pilot user of TGA trucks in Central
America. Gonzalez also plans to make his own paper. This will

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forum
01
02 03
require a lot of electricity. And, perhaps unsurprisingly, he wants
to produce this with his own diesel power plant. So, Gonzales
needs a diesel power plant ideally one powered by MAN diesel
engines. Yet again, MAN Ferrostaal México will handle the sale and
execution.
>>>Financing makes it possible. PCD’s large-scale expansion is based
on a tailored financing package. Based on in-depth research and
working closely with PCD, MAN Ferrostaal established a credit
history for the company for decision makers in Mexican and
foreign banks and credit insurance providers. Several credit insurance
providers were convinced by the realisation of the multi-faceted
printing package. MAN Ferrostaal designed a customised one-stop
financing package for PCD that meets its needs perfectly.
Daniel Reinhardt
01. Bus production in Querétaro:
By 2010, sales are set to rise to
1,000 vehicles per year.
02. Busses are an essential form of
public transport in Mexico. Not
everyone has a car and there is
no rail system, so long trips are
generally taken by bus.
03. The Lion’s Coach: MAN’s brand
in Mexico. Chassis are also
produced mainly for other manufacturers.

INTERVIEW
THINKING OUTSIDE THE BOX
An interview with Refugio Gonzales, owner/manager
of the packaging manufacturing company PCD in
Mexico.
Echo: Mr. Gonzales, you founded PCD in 1997 and
today you are market leader for printed packaging in
Mexico. What’s the secret of your success?
Gonzales: Well, my father had thrown me out of his
own company. He had established it when I was just
15 years old. My father is simply very conservative and
I was always a bit of a revolutionary. As a result, we
fought all the time. And so, in 1997, I set up my own
company. We started to produce product packaging
from corrugated cardboard. But we don’t just make
brown cardboard boxes. Our packaging looks great
and is colourfully printed. You couldn’t get this kind of
packaging in Mexico before. The demand was so high
our customers were practically grabbing the stuff out
of our hands! Today we produce 8,000 tons of printed
boxes on MAN machines.
So you’ve discovered a niche …
Yes, but of course that’s not all. What really gives us
the edge over our competitors is that we offer our
customers a full range of packaging-related services.
We don’t just deliver the boxes “just in sequence” to
our customers’ doors. We also take their packaged
products and deliver them to our customers’ customers.
This works very well because our customers can then
focus on their products and don’t have to worry about
the logistics. We take care of that.
So you could say you run a logistics company as
well as a printing works?
Correct. Or, to be more precise – not exactly. My
daughter Larissa manages logistics. This setup just
evolved naturally. We don’t just transport our own
products and our customers products. We also handle
goods from other company, such as bus components
for the production of MAN bus production in Querétaro.
Refugio Gonzales and his daughter Larissa
THE ECHO 1/2006 13
It sounds like you’re growing.
Yes. We began in 1997 and today we have 300 employees
and we’re still growing. Our annual growth
rate is currently between 30 and 50 percent.
How is such a high growth rate possible?
All profits are re-invested in our company. And our customers
and vendors have become friends. Friends are
something you need when you’re trying to build up a
company. But our market is also growing. At a rate of
approximately 7 percent per year. However, I think the
greatest factor in our growth is the fact that we don’t just
sell boxes; that we offer an end-to-end range of services.
So, what’s next for you?
We want to start making our own paper. To do this,
we need certain equipment and technology, as well as
a power plant. Perhaps we can work together on that
project also. In the long term, I want us to expand into
markets outside of Mexico. I see a lot of growth
potential there.

14
forum
SHIPYARDS FOR THE REPAIR AND CONSTRUCTION OF OIL AND GAS PLATFORMS
“RESTORING SOUTH AFRICA’S
LOST INDUSTRY”
Africa has reserves of more than 100 billion barrels of oil, much of which is located in deep waters offshore. The continent is also
known to have deposits of at least 500 billion cubic feet (13.5 trillion cubic metres) of natural gas. Production capacities will therefore
need to be expanded in many African countries. Currently, however, anyone wanting to build a new platform has to accept that
the waiting period may be anything up to six years.

THE ECHO 1/2006 15
African oil and gas deposits constitute approximately 10 percent
of all known reserves worldwide. With oil prices climbing, it is
becoming increasingly more cost-effective to produce oil and gas
in deep waters off Africa’s west coast, where currently little or no
production is taking place. However, the big oil companies discovered
Africa’s potential long ago. With state-of-the-art technology, operating
offshore platforms and producing oil and gas in deep waters is no
longer a problem.
The only problem is that there aren’t enough production
platforms. Due to the strong growth in the demand for oil, the
manufacturers of these platforms are fully booked up several
years in advance. “Currently, if an oil company wants to build an
oil or gas platform, they will have to wait for anything up to six
years,” says Horst Weretecki, who is responsible for offset business
at MAN Ferrostaal. In the case of production off the coast of
Africa, an additional constraint is the fact that each new platform
has to be hauled over thousands of kilometres by tugboats. Africa
currently has no shipyards for the construction of oil and gas
platforms.
According to Weretecki, the situation doesn’t look any better for
existing platforms: “If an oil company that wants to produce oil
on the West-African coast needs to maintain or repair a large
platform, the platform has to be brought to Europe, the US, Dubai
or Singapore to have the work done. There simply isn’t any
company in Africa who can do the job here.” In the best-case
scenario, the distance is 8,000 kilometres. In the worst, 16,000. It
all depends on which location currently has capacity. “Even at
that, you are lucky to even get a free slot because these shipyards
also get booked up very quickly. That can really hurt your purse.
For every day that a platform is out of action, you are losing
approximately 400,000 to 500,000 US dollars in rent.” This is
why MAN Ferrostaal is now working on a project to remedy this
situation.
In South Africa, the climate is ripe for building an industry for the
construction and maintenance of oil platforms. All of the key
partners for this project are strongly positioned in the country:
shipyards that focus on ship construction and others that focus
on repair, companies in the oil and gas industries, companies that
can deliver and maintain the technical equipment for platforms,
and civil engineering companies that can provide the infrastructure
for the harbour facilities. The country also has partners to finance

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forum
01
the project. Not least the South-African government and authorities,
who are open to the idea. MAN Ferrostaal is currently bringing all
of these partners together.
“Ironically, South Africa had a shipyard that built a large gas
platform 15 years ago. This platform is still in use today in the
Mossel Field Bay on Africa’s east coast. The operator, Mossgas, was
convinced that other gas reserves were to be found outside the
Mossel Field. However, this did not prove to be the case,” says
Weretecki. The shipyard was therefore shut down after the first
platform was built. “Today we are restoring a lost industry to
South Africa.”
MAN Ferrostaal is working on two different projects. In Saldanha
Bay on the east coast, we are building a shipyard for the construction
and remodelling of offshore platforms. In Cape Town, meanwhile,
we are constructing a service and repair centre for platform maintenance.
In addition to MAN Ferrostaal and the local project developer
Atlantis Marine Projects, national and international companies
are involved in financing these projects, i.e. the Deutsche
Investitions- und Entwicklungsgesellschaft (DEG) development
finance institution and the Industrial Development Corporation
of South Africa.
MAN Ferrostaal’s role in the projects comprises project management,
overseeing the construction of both shipyards as a general
contractor and then making these available to local industry.
Essentially, this involves bringing together the various companies
that are looking after individual components of the projects and
are based in various parts of the country, so that they can function
as a single operator. The five major technical partners are
Grinaker, DCD Dobyle Engineering, DCD Dorbyle Marine, Globe
Engineering and SA Five Engineering.
MAN Ferrostaal and partners are directly and indirectly investing
approximately 1.7 billion South-African rand (160 million euros)

in the projects. This will give a major boost to the economies of
the Western Cape and Saldanha Bay regions. A total of 12,000 new
jobs will be created, 1,500 in the two shipyards directly.
The project is therefore very important to the South-African
government: the country’s unemployment rate is approximately
30 percent. Against this backdrop, the authorities have welcomed
the project with open arms. The planned investments are
well suited to supporting the South-African economy and
further reducing poverty. This project will also fulfil MAN
Ferrostaal’s offset obligations that the company undertook as part
of the sale of submarines eight years ago.
At the official announcement of the project at the Oil Africa fair in
March, Brian Blackbeard, Managing Director of Atlantis Marine
Projects said that the new oil fields to be developed off the west
coast of Africa meant an increasing demand for new platforms
and for the maintenance of existing production facilities. Since
THE ECHO 1/2006 17
02 03
the existing shipyards in Europe, Asia and North America are fully
booked up, he expects the two new shipyards in South Africa to
receive orders immediately. He estimates that annual sales will
initially be approximately 840 million rand (90 million euros).
The shipyards are scheduled for completion in 2007.
The long-term prospects for the project are also good. Given the
tensions in the Middle East, the United States wants to reduce its
oil imports from that region by 75 percent by 2025. At the same
time, US companies are also in the process of diversifying their
supply relationships for the purchase of oil worldwide. Africa is
very much in focus in this regard. American oil imports from
Africa are set to rise in the next 10 years from 16 to 25 percent.
Investment in this sector is accordingly and is essential. Experts
predict that US oil companies will invest approximately 10 billion
US dollars in the African oil industry in the short to medium term.
Daniel Reinhardt
01. The A berth in the port of Cape Town:
The future location for a service and
repair centre for platforms.
02. Impression of the planned service and
repair centre.
03. Transporting platforms is expensive.

18
projects & contracting
01
METHANOL PLANT IN OMAN
OFF TO A GOOD START IN OMAN
PROJECT DATA MO3000
Project Company: Oman Methanol Company LLC (OMC)
Owners:
>> 50% MHIL (Methanol Holdings International Ltd.)
>> 30% OMHC (Oman Methanol Holdings Company Ltd.)
>> 20% FMIL (MAN Ferrostaal Methanol International Ltd.)
Plant capacity: 3,000 ton per day (1,050,000 tons per year)
Operation/License: Johnsson Matthey/PLC
Low pressure methanol synthesis processes
Main Plant Units:
>> Process unit
>> Operating material systems
>> Methanol tanks
>> Buildings
>> Natural gas measuring station
Work on the first methanol plant (M03000) in Oman is in full
swing. MAN Ferrostaal is responsible for the engineering and procurement
of the 523 million dollar project. After its completion,
the MO3000 plant in Oman will produce more than 1 million tons
of methanol per year. Engineering, procurement, construction
and assembly are all running to schedule. After the financing
contracts were signed and the project contracts came into effect
in March 2005, the hot phase of the procurement of critical plant
equipment began. The prerequisite for punctual ordering was for
the engineering to be started early by the Japanese engineering
company Toyo.
Specifically, the following progress was made in the early summer
of 2006: buildings 80 percent completed, roads 90 percent completed
and foundations for the reformer, waste heat boiler, reactor
and refinery column 100 percent completed. The installation
of the main pipe bridge as well as the assembly of the methanol
storage and water tanks is also completed. The mechanical completion
of the plant is scheduled for the start of the third quarter
of 2007.

TRANSFERRING THE TRINIDAD MODEL TO OMAN
Oman provides excellent conditions for the construction of a
methanol plant: good investment climate, outstanding infrastructure
and a supply of natural gas. Furthermore, the sultanate
offers local partners willing to invest in petrochemicals. The project
company Oman Methanol Company consists of three strong
partners: the Methanol Holdings (Trinidad) Limited (the owner
of the Trinidad plants, the Oman’s OMZEST Group and MAN
Ferrostaal AG. As with the plants in Trinidad, the project will
be financed mainly by KfW loans backed by HERMES credit
insurance.
MAN Ferrostaal is responsible for the offshore part of the project,
the engineering services and the procurement for the complete
plant. The onshore component, chiefly the local construction and
commissioning activities, will be handled by the Oman company
Oman Proman Contracting & Trading LLC (OPCT). The target market
for the methanol produced in Oman is the chemical industry in
Europe and Asia.
Holger Lexius
02
03
01. Service buildings, one main
pipe bridge and two water
tanks – the MO3000 plant
02. The administrative building.
03. Welding a water tank.
THE ECHO 1/2006 19
THE TRINIDAD MODEL
Over the last 15 years, MAN Ferrostaal and its partners have
evolved into the second-largest producer of methanol, producing
over 4 million tons per year. The company has stakes in five
methanol plants in Trinidad, four of which they built as a general
contractor.
MAN Ferrostaal developed a new financing model in which the
company itself acquires an investment in the plant, thereby
assuming part of the risk. The essence of this concept was that
MAN Ferrostaal had to secure every link in the value-added
chain, from processing the methanol, to transport, to marketing
of the product.
In 2000, MAN Ferrostaal began planning the world’s largest
methanol plant, the M5000, also to be built in Trinidad. The
necessary equity capital was financed through the cash flow of
the existing methanol plants. The property value of the almost
entirely unencumbered “old” plants also represented additional
collateral for the foreign financing of the new M5000 plant. This
so-called structured project financing is a combination of some
aspects of project financing with components of classic corporate
financing.
This model, whereby the general contractor takes an equity
stake in the project, turned out to be advantageous to the
clients in the case of the four plants built in Trinidad: all of the
plants were finished ahead of schedule and within the planned
budget. All of the plants have attained or exceed the agreed
capacities and are producing according to the specifications,
with a very high level of operational availability. With this business
model, MAN Ferrostaal changed the role of the general contractor
in the construction of large industrial plants. The focus in
building the plant was not only on turnkey delivery, but also on
all other elements that were essential to the plant’s success.
METHANOL
In recent years, the market for methanol has experienced a
stable, upward trend. While the price per ton of methanol was
still around EUR 125 at the beginning of 2002, it is currently
over EUR 250 due to the closing down of plants in the USA
and Europe. Methanol can be used either as environmentally
friendly fuel or as a raw material for further processing in the
chemical industry. Thus, methanol can be found in plastics,
synthetic textiles, pigments, coatings and many other chemical
products. At normal temperatures and atmospheric pressure,
methanol is a liquid and is therefore easy to transport over long
distances by ship and by truck.

20
projects & contracting
MODERNISATION OF A COGENERATION PLANT IN WUPPERTAL
CLEAN
AND EFFICIENT
The modernisation of the cogeneration plant in Wuppertal was
MAN Ferrostaal’s first turnkey power plant project at home.
The recently opened new 60 MW Block 1 of the Barmen plant
is based on the cogeneration principle, resulting in a very
efficient and clean operation.
With the modernised Block 1 of the Wuppertal cogeneration plant,
the Wuppertaler Stadtwerke are able to supply the city and
the surrounding area with electricity and district heating. The
modernisation has benefits for the environment. The new plant
not only operates more efficiently then the old one, it also
reduces CO emissions by 200,000 tons per year and cuts nitrogen
oxide and carbon monoxide emissions by 50 percent.
In a modern gas and steam cogeneration plant like Barmen, gas
turbines are used to generate electricity. The turbines’ hot
exhaust gases are piped into individual waste heat boilers, where
steam is generated. This steam drives a downstream steam
turbine, in which electricity is generated and steam is also
extracted to supply long-distance heating.
As the general contractor, MAN Ferrostaal was responsible
for turnkey planning, construction, procurement, delivery and
commissioning of the gas and steam cogeneration plant.

The new 60 MW Block 1 of the Wuppertal-Barmen plant reduces emissions of airborne
pollutants by more than 50 percent.
The crowded location of the new power plant in the Barmen
district of Wuppertal, between the Wupper river and the Cologne-
Hanover high-speed rail line, presented a particular challenge
during this project: the existing power plant is located in a highdensity
residential area. The new plant was constructed in very
cramped conditions in the partly gutted buildings of the existing
plant, which continued to be operational during the construction
phase, and was then connected to parts of the existing plant.
The construction phase remained on a very tight schedule within
17 months. This meant that a buffer could be built into the timeconsuming
phase that began with the first run-up of the gas turbine
and included commissioning of all components, functional
testing, and, finally, optimization. The agreed completion deadline
of the end of 2005, which was necessitated by the regulations
on cogeneration, was therefore never in question.
The agreed timescale for the plant from signing the contract up to
being ready for commercial use was just 22 months. The acceptance
test for Phase 1 of the project, i.e., the integration of the existing DT
23 steam turbines into the new electrotechnology and control
technology infrastructure, was conducted as early as December
2004. In December 2004 and January 2005, gas turbines, generators,
and boiler components were delivered for assembly. In June 2005,
the first gas turbine was started up, and, in December 2005,
Wuppertaler Stadtwerke signed off on the completed plant.
Helmut Wolff
SCOPE OF SUPPLY AND SERVICES
THE ECHO 1/2006 21
>> Two 30 MW gas turbines from Hitachi in Japan, complete
with generators, and two waste heat boilers manufactured
by Innovative Steam Technology (IST) in Canada
>> All electrical and process control technology
>> Piping for water/steam circulation, including pumps and
heat exchangers
>> Installation of all essential auxiliary systems including a
cooling water supply system, air inlets, fire protection
installations, heating/climate control/air conditioning
>> All required underground and structural engineering
services
>> Architectural design
>> Design of all unit operations
>> Detailed engineering
>> Selection of all plant components
>> Configuration of electrical and process control technology
and safety equipment
>> Construction of the new boiler house, foundation rafts for
boilers and gas turbines
>> Coordination and construction management
>> Assembly of all components
>> Commissioning and testing
>> Documentation and training

22
projects & contracting

MAN FERROSTAAL ACQUIRES RWE’S PULP AND PAPER BUSINESS
PULP: A PRODUCT WITH PROSPECTS
THE ECHO 1/2006 23
In April 2006, MAN Ferrostaal acquired the Pulp and Paper segment of RWE Industrielösungen GmbH, including 25 employees, to
boost its own plant construction business.
In addition to recycled paper, pulp is the most important raw
material for paper. Demand is growing continuously by approximately
5 million tons per year. Suitable locations for new plants
are Latin America and Southeast Asia markets – in which MAN
Ferrostaal already has a strong presence. Only a few suppliers
worldwide are capable of building this type of plant. MAN
Ferrostaal is one of them, not least because of its strong financial
background and its experience in project financing.
LONG-STANDING COLLABORATION
In April 2006, MAN Ferrostaal therefore acquired RWE’s Pulp and
Paper segment of RWE. In addition to the 25 RWE employees,
expertise, references and projects as well as sales offices in
Thailand and Vietnam were transferred as part of the acquisition.
MAN Ferrostaal can now also rely on the expertise of KSH
Solutions Inc. in Montreal, RWE’s Canadian engineering firm
specialising in pulp and paper. KSH and MAN Ferrostaal have
agreed on long-term, exclusive cooperation.
MAN Ferrostaal’s entry into this business area is accompanied by
favourable conditions. Global economic growth has led to a strong
global demand for pulp. In order to meet this demand, one or two
new large plants will have to begin production each year.
The raw material (wood), the pulp plant in Stendal (Germany), pre-packaged pulp
The global consumption of paper products is growing by two to
three percent annually, with the largest growth in Asia (China,
India, ASEAN nations). This results in a growing demand for pulp
as the raw material for all types of paper, also with a growth of
approximately 2.5 percent per year. The global demand for fresh
pulp is growing by approximately 10 million tons per year (230
million tons in 2005). A large part of this annual growth is
accounted for by “market pulp”. This is pulp that does not go into
the processing of paper in integrated plants. Instead, it sold freely
on the global market by the manufacturers.
This provides a sound basis for future success, according to
Wolfgang Marschewski, who is responsible for the pulp plant business
at MAN Ferrostaal: “New pulp plants only become profitable after
they have reached a certain minimum size, and project financing
plays a crucial role in this. In these kind of projects, only a
financially solid plant construction partner like MAN Ferrostaal
will be considered as a general contractor.”
GREAT POTENTIAL
MAN Ferrostaal sees the greatest potential for the construction of
new pulp plants in humid climate zones in Brazil, Uruguay and
Chile, and in Indonesia, Malaysia, Thailand and Vietnam. Here, the
raw material (wood) is grown in large plantations (approximately
250,000 hectares) for approximately seven to ten years. The

24
projects & contracting
01 02
01. The pulp plant in Stendal, Germany
02./03. The Estonian Cell pulp plant in Estonia
conditions are completely different in Europe, where the “crop”
cannot be harvested before 35 years in Germany and 60 in
Finland.
In the past, some pulp plants practised deforestation wherever
and however they pleased in densely forested areas. As a result,
the entire industry was regularly the object of criticism by conservationists.
This situation has now radically changed. Today,
investors can only build new plants if they use wood produced by
sustainable forestry. In other words, they must prove that they are
managing their raw material in a sustainable way, i.e. growing new
trees to replace those that are cut down. Otherwise, no bank will
even consider financing their project. MAN Ferrostaal fulfils this
requirement for all of the very promising RWE projects it has
acquired.
STATE-OF-THE-ART PLANTS
The essential features of pulp manufacturing can be illustrated
using the example of the state-of-the-art pulp plant in Stendal in
Saxony-Anhalt in Germany. The most important component is
the “fibreline” production line, which accounts for one third of the
total cost of constructing a new plant. The machinery and
equipment used there extract most of the lignin from the fibrous
raw material (hardwood or softwood). Lignin is a chemical
compound that gives a tree its strength and durability. At the end
of the process, after cleaning/sifting, bleaching and draining,
the pulp is ready to be used as a preliminary product for further
processing into paper.

Most of the remaining two thirds of the costs of a new plant go
into energy supply, chemical recovery, water preparation and
wastewater treatment. Auxiliary plants serve to protect the environment
and play an important role in the construction of a new
plant. Investors must be able to prove that the new plant avoids
harming the environment, that chemical waste from pulp production
is recycled in an environmentally sound way, and that waste
water is cleaned and treated before it is returned to water sources.
RWE fulfilled all of these requirements in the last orders they
completed. This is demonstrated by the plants in Musi
(Indonesia), Stendal (Saxony-Anhalt) and the Estonian Cell plant
in Estonia. The water used for at the Stendal plant is actually
cleaner overall when it is returned to the river Elbe than when it
is taken out.
03
THE ECHO 1/2006 25
RWE, in whose footsteps MAN Ferrostaal is now following and
whose references Ferrostaal has acquired, could always rely on the
expertise of KSH. KSH is one of the few engineering companies
worldwide that are capable of planning and optimising an entire
plant, including the core components and auxiliary plants. MAN
Ferrostaal will continue to work with KSH as an engineering
partner and will reinforce this collaborative partnership by taking
a minority interest in KSH and a seat on its board of directors.
Ulrich Bange

26
projects & contracting
PLANT IN PERU REMAINS FULLY OPERATIONAL DURING RENOVATIONS
A NEW LEASE OF LIFE IN PERU
After 60 years in operation without any renovations, the international energy company Edegel/Endesa awarded Voith Siemens
Hydro Power Generation, Brazil und MAN Ferrostaal the contract for the modernisation of its hydroelectric plant in Callahuanca,
Peru. The plant was given a “new lease of life” with a high level of operational reliability, dispatchability and a capacity increased
by 25 percent.
01
Endesa is Spain’s largest energy company.
It enjoys a large share of the electricity
generation market in Latin America with,
for example, hydroelectric and thermal
plants, but mainly gas turbine plants. In
Peru, Endesa is the majority shareholder
(63%) in Edegel S.A.A.
Endesa’s 60-year-old hydroelectric plant
in Callahuanca is now an example of stateof-the-art
technology. It meets the technical
requirements for automatic operation
of the various plant facilities from
a central point of control. Edegel/Endesa
required a contractual guarantee that its
operations would be disrupted as little as
possible during project. The renovation
and commercial commissioning of each of
the three units had to be completed during
a shut-down period of just 90 days,
while the plant remained fully operational.

This required very tight coordination
between Voith Siemens and MAN
Ferrostaal.
HIGH DEMANDS
The contract was the first of its kind to be
handled by Voith Siemens Hydro outside of
Brazil and the first example in South America
of an integral modernisation project with
both foreign and local involvement.
The project placed the highest demands on
the technical and commercial project
management team. MAN Ferrostaal exploited
its expert knowledge of what the
domestic market has to offer (local manufacturing
capabilities, material procurement,
transport and logistics services, customs
clearance, construction and assembly), so
that a very high proportion of materials
and services were supplied locally. Making
the most of local services is of strategic
importance for all international investments
in Peru.
The offshore part of the project consisted
mainly of engineering and components of the
electro-mechanical imports, construction
02
01. The Callahuanca hydroelectric plant lies at the
foot of the Peruvian Andes
02. The turbine room after refurbishment
03. The new control centre
management, as well as assembly and construction
supervision. By the time the contract
was completed, the offshore and onshore parts
of the project each amounted to 50 percent.
Despite some surprises along the way,
everything remained on schedule with no
production downtimes.
THE ECHO 1/2006 27
NEW HYDROELECTRIC PLANT PLANNED
The Voith Siemens Hydro/Siemens and
MAN Ferrostaal consortium signed a
contract in April 2006 with the Rizo Patrón
group for the delivery of the electromechanical
plant equipment. Total investment
in the new 220 MW hydroelectric
plant in El Platanal amounts to 180 million
US dollars, with the electro-mechanical
component accounting for approximately
03
23 percent. El Platanal will be the third
largest hydroelectric plant in Peru and will
be fully operational in 2009.
Goetz Truebenbach Wolff

28
projects & contracting
01

NEW BLAST FURNACE COMPLETED FOR ARCELOR
READY FOR
BLASTING
THE ECHO 1/2006 29
Steel is one of Brazil’s most important exports. Thanks to the
country’s rich deposits of iron-ore, the production of hot liquid
metal (or pig iron) is continuing to grow. This summer, Blast
Furnace 3 will be completed for CST Companhia Siderúrgica
Tubarão and will be ready to start “blasting”. A consortium
comprising MAN Ferrostaal, Voest Alpine Industries UK and Paul
Wurth is responsible for the turnkey construction of the project.
The Brazilian steel giant Companhia Siderúrgica Tubarão (CST) is
currently in the process of increasing its total output of pig iron
from 5 to 7.5 million tons per year. The third furnace has already
been constructed in Vitória. It must now undergo various stages
of functional testing. Once it is fully operational, the maximum
annual capacity of the furnace will be 3 million tons of hot metal.
With the project come a number of economic advantages: The
unemployment rate in Vitória and in the state of Espírito Santo
has fallen and investment in this project is playing an important
part in the local economic upturn. During the main installation
phase, some 12,500 people were working on CST’s various
construction sites in Vitória. Despite some obstacles (the weather
and strikes), the construction of Furnace 3 remained on schedule.
In the final phase alone, 2,500 people were working around the
clock to complete the work for the consortium. As a result, the
testing and commissioning phase of the furnace began in April
as planned.
LONG-STANDING COLLABORATION
Over the past ten years, MAN Ferrostaal has worked closely with
CST to help it achieve its plans for expansion. In 1996, CST awarded
a contract for the turnkey construction of Furnace 2, which
increased its production of hot metal by 1.4 million tons per year,
to a consortium comprising MAN Ferrostaal, MAN GHH and DME.

30
projects & contracting
02 03
01. Page 28/29: General view of the furnace shortly before
completion
02. Blast Furnace 3 during final assembly: Lifting the final
conveyor bridge onto the top of the furnace
03. The Brazilian-designed blast furnace burdening unit is
made from concrete.
04. The water cooling system for the furnace is very compact
due to the space restrictions.
05. The middle ring of the furnace shell is carefully positioned
before welding.
In April 2004, MAN Ferrostaal and its consortium partners Voest
Alpine Industries UK and Paul Wurth, together with their operational
subsidiaries in Brazil, won the contract for the turnkey construction
of another blast furnace. Thanks to the relationship it enjoys
with KfW/Euler-Hermes and the positive experience of working
on Furnace 2, MAN Ferrostaal was in a position to organise the
entire financing package for the import part of the project and to
assume responsibility for financial management of the project as
a whole. Working closely with its European consortium partners,
MAN Ferrostaal drafted the basic engineering and installation
04
05
plans, including the plans for materials management and burdening,
as well as the essential energy supply system. The local subsidiary
MAN Ferrostaal do Brazil was largely responsible for the
MAN portion of the detail engineering and for delivery.
HEAVY CRANES AT WORK
During the construction phase, 16 cranes with lifting capacities of
between 22 and 600 tons were employed within a very small
space to handle the heavy steel construction of the furnace and all
related work. This included the lining of the furnace, construction

of the water treatment system, installation of various electrical
buildings and pipework and the assembly of numerous components.
The largest crane, with a hoisting capacity of 600 tons, was
brought in from Trinidad. After erecting the last heavy components
to a height of over 100 m (including the blast furnace
gas valves, valve platform and the highest component of the main
conveyer belt, which weighed in at 100 tons), the crane was
dismantled and shipped to the next construction site. After the
most important equipment and piping were installed by
THE ECHO 1/2006 31
April/Mai 2006, electrification of the facility was successfully
completed with the special involvement of the ALSTOM.
The test series of the individual components and areas of the
facility are currently being conducted as sequence tests. Cold
commissioning and handover of the entire furnace is scheduled
for July 2006.
Walter Offner, Thomas Lehmann
SCOPE OF SUPPLY AND SERVICES FOR CST’S
BLAST FURNACE 3:
>> Burdening unit
>> Main conveyor belt
>> Water treatment system downstream
from gas cleaning system
>> Dust removal system for blast furnace
gas and furnace casting house
>> De-dusting unit for the burdening
facility
>> Furnace cooling system, including
cooling towers, pumps, heat
exchangers and piping
>> Pipe bridges and gas piping
>> Electric control panels and switchboards
>> Transformers
>> Climate control for all areas
FURNACE PROJECT KEY FIGURES
>> Local orders in Brazil: ~ 150
>> Concrete: ~ 36.462 m 3
>> Fire-resistant material: ~ 19,850 tons
>> Steelwork: ~ 8,800 tons
>> Machinery/equipment: ~ 6,800 tons
>> Piping material: ~ 3,600 tons
>> Cabling: 500 km
>> Total hours worked: 4.9 million
>> Construction
and assembly workers: 2,500

32
projects & contracting
A GROWING MARKET IN MAURITANIA
IRON ORE PELLETS IN GREAT DEMAND
The West-African nation of Mauritania is rich in iron ore deposits. MAN Ferrostaal is investigating the feasibility of opening a new
iron ore mine on behalf of the state-owned iron ore company SNIM, Société Nationale Industrielle et Minière. The iron ore will be
processed into concentrate and then refined into high-quality iron ore pellets. Iron ore pellets are used in direct reduction plants
worldwide for the production of steel.
On behalf of the Mauritanian project
management company EL AOUJ S.A. MAN
Ferrostaal is conducting a feasibility study
examining the economic efficiency of a
new iron ore mine. The investment and
costing calculations mainly focus on iron
ore processing, an iron ore pellet plant,
materials handling, a power plant, electricity
supply, assembly, and infrastructure.
The new deposit is located close to existing
mines in the town of Zouérate. The iron ore
deposit is estimated to amount to about
650 million tons. With a mining capacity
of approximately 15 million tons per year,
it should be possible to produce 7 million
tons of iron ore pellets. The existing
railway line will be extended for the
transportation of the finished product to
the coast.
A FAMILIAR MARKET
Mauritania is a familiar market for MAN
Ferrostaal: business started 40 years ago,
when Ferrostaal supplied 142 heavy railway
cars for the transportation of iron ore
concentrate to the former French colony.
These were employed on the newly built
700 km stretch of railway between the
mine in Zouérate in the middle of the
Sahara and the sea port of Nouadhibou.
The good contact with the state-owned
iron ore company SNIM resulted among
other things in MAN Ferrostaal winning
another contract for an iron-ore processing
plant. MAN Ferrostaal supplied rolling
presses, conveyor systems, production
equipment, steelwork and electrical equipment,
and supervised the assembly and
commissioning of the iron-ore reduction
plant.
GREAT POTENTIAL
Industrial development in Mauritania offers
MAN Ferrostaal countless opportunities.
Projects currently in the pipeline include
diesel power plants, expansion of the ironore
port in Nouadhibou, repair and extension
of the existing SNIM railway line, construction
of a new stretch of railway to develop the
country’s southern corridor, development of
very high-quality phosphate ore production,
and modernisation and development of the
existing iron-ore production facility.
In addition, local oil production (75,000 barrels
per day), which began in February 2006,
and Mauritania’s very promising offshore
reserves of natural gas are opening up new
horizons for potential projects utilising gas.
Burkhard Willems

03
THE ECHO 1/2006 33
01/02 The iron-ore is transported from the
storage area to the ship-loading in the sea
port of Nouadhibou.
03. 80-ton goods wagons for iron-ore concentrate
on their way from Zouérate to Nouadhibou.
01
02

34
projects & contracting
SHIPBUILDING
SAFETY ON THE HIGH SEAS
Major oil disasters like the sinking of the “Prestige” in 2002, which leaked some 64,000 tonnes of oil off the Spanish coast, have led
to a tightening of safety measures at sea. For example, the International Maritime Organization (IMO), a United Nations agency, has
intensified its regulations and shortened the phase-out period for single-hull tankers. Specifically, it intends to ban the use of singlehull
tankers for the transportation of oil products as of 2015 and to monitor seafaring ships of this type more closely until then.
Over the next seven years, about 2,000 outdated oil and chemical
tankers are to be replaced. More than 1,000 tankers with a load
capacity of between 5,000 and 10,000 tdw (tons dead weight)
sailed the high seas in 2003. By 2015, single-hull tankers of this
size will be taken off the market. They will be replaced by doublehull
tankers like the SCOT series tankers built on behalf of MAN
Ferrostaal.
In the last four years, MAN Ferrostaal has handed over eight SCOT
8000 tankers to Wappen-Reederei and repeat orders have been
placed for four more. The tanker design was developed by the
Hamburg shipbuilder Günther Kordts, founder of Wappen-
Reederei, in collaboration with the Lindenau shipyard in Kiel and
MAN Ferrostaal.
The main impetus behind the idea was the increased threat to the
environment posed by single-hull tankers and single-screw vessels.
The team, led by Günther Kordts, designed a tanker for transporting
products and chemicals that guarantees maximum safety and
a very low probability of failure. The double hull, which also

contains the bunker tanks, significantly reduces the risk of damage
to the cargo and bunker tanks and thus also the risk of a cargo
outflow similar to the one which occurred with the “Prestige”.
A redundant propulsion system with two completely separate
shaft and steering gear systems ensures full manoeuvrability of
the ship should one of the systems fail.
MAN Ferrostaal was able to bring its sister company MAN B&W
Diesel into the partnership as a supplier of the complete propulsion
systems. These include the 6L27/38 four-stroke main engine, gears
and shafting.
Two boiler units similarly ensure sufficient heat output, which
can be individually regulated for the different tanks, depending
on the load. SCOT 8000 tankers also benefit from 16 coated cargo
tanks and two deck tanks with a total capacity of 9,000 cubic
metres. A fully segregated piping system allows up to 16 different
TECHNICAL DETAILS (WAPPEN VON FRANKFURT)
THE ECHO 1/2006 35
>> Vessel type Oil and chemicals tanker
with a double hull
>> Tonnage 8,000 tdw (tons dead weight)
>> Main engine
propulsion system 2 MAN B&W engines, each with a
capacity of 800 kW incl. gears and
shafts
>> Speed 14.5 knots
>> Crew 11 – 13 persons
>> Tank volume 9,100 cbm
>> Length over all 116.40 metres
>> Breadth 18 metres
>> Freeboard depth 9.40 metres
>> Draught 7.40 metres
>> Tanks 16 tanks (12 – 1,185 cbm)
plus 2 deck tanks
>> Segregation 16 different products can be
loaded simultaneously
>> Tank heating system Up to 80° Celsius in each tank
>> Pumps 16 pumps
>> Builder: Damen Shipyards, Galatz
>>> GREENPEACE CALLS THE SCOT
SERIES THE “SAFEST TANKERS IN THE
WORLD”.
goods to be loaded simultaneously. The tank specifications enable
the transportation of more than 500 different goods, as well as
flexible use of the tankers across all markets.
Thanks to their safety and flexible loading systems, the chemical
tankers are in great demand as charter ships for major shipping
companies like Esso, BP, Shell and BASF. Due to their compact size
(small, handysize tankers), they can access even the smallest ports
all over the globe.

36
projects & contracting
THE GENERAL CONTRACTOR
With shipbuilding projects, as with the construction of industrial
plants, all of the different threads are brought together by
MAN Ferrostaal in Essen. Each of the delivered ships was built at
Damen Shipyards Galatzin in Romania under the supervision
of the customer, Wappen-Reederei, and MAN Ferrostaal. As the
general contractor, MAN Ferrostaal is responsible for sourcing the
materials (including high-tech equipment), just-in-time delivery
of components, execution and coordination of new building
projects and handover of the tankers according to schedule. Also
collaborating on the project are the issuing house Hansa
Hamburg Shipping and the KfW banking group. These will
provide the investment required to realize the projects, which
amount to a total order volume of 214 million euros.
Since the charter books for the SCOT tankers are already fully
booked, four more ships are to be built and are scheduled for
completion by the same partners in 2007 and 2008. The transportation
of oils and fats promises additional long-term opportunities
for the chemical tankers. The IMO has therefore announced
stricter transportation regulations for 2007. Currently, only very
few tankers would be in a position to comply with these. Petra
Kapp, Project Manager for SCOT tanker projects at MAN Ferrostaal
AG, is confident about how this market will develop: “The SCOT
tankers MT “Wappen von Frankfurt” and MT “Wappen von
Stuttgart” currently comply with all known safety regulations,
even those that have not yet come into force. These ships and the
four new tankers will afford us a great opportunity to service the
increasing demand for high-quality tanker tonnage.”
Anna Fontaine
As safe as possible: The double hull minimizes
the risk of leakage for the Wappen tankers.
CARGO CARRIED BY THE SCOT 8000 TANKERS:
Paraffins: Saturated hycrocarbons, main
components of crude oil, slack wax
Lubricating oil additives: Agents that are added to base oils
to give them lubricating properties
Molasses: A syrupy liquid by-product of the
production of sugar from sugar
cane and sugar beet that has been
shown to have health benefits
Chemicals/
Oil products: Kerosene, benzenes, lubricating oil
Edible oils: Sunflower oil, groundnut oil, castor oil

Vietnam is on the road to becoming an industrial nation. The
demand for steel is growing all the time due to the emerging industry
and the countless infrastructure projects in the country. In the last
ten years, demand for steel in Vietnam has risen by an average of
20 percent per year. And the current annual demand of 6 million
tons is set to rise to approximately 15 million tons by 2015. In 2005,
steel imports amounted to 5.5 million tons, equalling more than
90 percent. Vietnam intends to reduce its heavy dependency on
imports, in particular of warm-rolled and cold-rolled flat products,
by securing extensive new investments in the country.
Vinashin’s new mill will produce heavy plate with a maximum
width of 3 m, maximum length of 18 m, and a strength of 5 to 50 mm.
The raw material will be imported steel slabs. The steel
construction halls are approximately 600 m long. Since the entire
area on which they are being built is water-logged because it was
reclaimed from the sea, the foundations of the halls and the
heavy machinery had to be mounted on concrete piles. The foundations
and halls are to be constructed by Vietnamese companies,
THE ECHO 1/2006 37
VINASHIN BUILDS A NEW PLATE MILL IN VIETNAM
BUILDING SHIPS WITH THEIR OWN STEEL
The Vietnamese state-owned shipbuilding group Vinashin will in future be able to produce the heavy plate it requires to build ships.
In the Quang Ninh province near the port of Cai Lan in northern Vietnam, Vinashin is constructing a new hot-rolling mill with an initial
annual capacity of 350,000 tons. MAN Ferrostaal is responsible for engineering and project management.
while the rolling mill machinery will be supplied by Chinese
manufacturers.
ON-SITE EXPERTS
MAN Ferrostaal will work with a large team of on-site experts to
supervise and coordinate the engineering. The team will be reinforced
by Vietnamese engineers and will receive support from the
MAN Ferrostaal office in Hanoi.
A steel manufacturing plant is being constructed at the same time
right next to the rolling mill. The production lines originated in
Germany and were dismantled and shipped by order of MAN
Ferrostaal in the summer of 2005. MAN Ferrostaal will supervise
their re-assembly in Vietnam.
Wilhelm Bruckmann
The first concrete piles
were driven into the soil
in January 2006.
The heart of the rolling mill:
the heavy plate mill stand.

38
projects & contracting
01
PRODUCTION PLANTS FOR GYPSUM PLASTER BOARDS IN INDIA AND MALAYSIA
GYPSUM BOOM IN ASIA
The market for gypsum plaster boards is booming in Asia. British Plaster Board (BPB) is therefore increasing its capacity with two
new production plants in India and Malaysia. No sooner had the MAN Ferrostaal/Grenzebach/BSH consortium handed over the
first gypsum and gypsum plaster board plants to BPB than plans for two more plants in India were underway.

In May 2004, a consortium led by MAN
Ferrostaal signed the contracts for the
delivery, assembly and commissioning of
the process equipment for gypsum and
gypsum plaster board plants in Mumbai
in India and Port Klang in Malaysia. The
customers are the subsidiaries of British
Plaster Board plc, England. The assembly
and commissioning of the two plants were
planned and realised within three months
of each other.
The plants manufacture gypsum plaster
boards for finishing the interiors of private
and commercial buildings. In the gypsum
plant, natural or synthetic gypsum is
converted into stucco through calcination
(dewatering). Stucco is the raw material for
the manufacture gypsum plaster boards
and can be mixed with chemical additives
to produce plaster. In the gypsum plaster
board plant, the stucco is mixed with water
and other additives and poured into
02 03
04
a mould made of special board to give
a continuous running sheet of plaster
board. This sets as it passes along a conveyor
belt, at the end of which an electronically
controlled cutter is used to cut the strand
into gypsum plaster boards of any length.
These are fed through a continuous-flow
10-deck drier with a length of approximately
90 meters. Once they have passed
through the drier, the gypsum plaster
boards are adjusted and then automatically
stacked and grouped together in packages
ready for loading and distribution.
The plant in India has the capacity to produce
12.8 tons of stucco per hour and 1,610
meters of gypsum plaster boards per
hour. In Malaysia, 14.2 tons of stucco are
produced per hour and 2,343 metres of
gypsum plaster board.
The process equipment was supplied by
European, Chinese and local manufacturers.
05
THE ECHO 1/2006 39
Precise planning and coordination with
both the customer and the authorities
were required to ensure a seamless implementation
of the machinery and equipment.
The mechanical assembly began in India in
January 2005 and in Malaysia in April 2005
and ran according to schedule in both
cases, although the construction site in
India presented some problems due to the
weather conditions (the heaviest rainfall
for decades) and the isolated rural location.
The provisional acceptance (take-over) of
the two plants took place in December
2005 and February 2006 respectively, as
per the project plan.
Jan Uder, Walter Sante
01. Assembly of the calcination unit in India
02. The gypsum plaster board plant in Malaysia
03. The calcination unit in Malaysia
04. The drier outlet, India
05. Cross conveyor and drier inlet for gypsum
plaster boards, Malaysia

40
projects & contracting
MAINTENANCE STAFF MOBILISED IN LIBYA
INTO THE DESERT
MAN Ferrostaal takes over maintenance of the “Wafa Desert Plant” for the Libyan gas supplier ENI Gas B.V. Over a period of 23
months, ThyssenKrupp Uhde and MAN Ferrostaal will maintain an oil and gas production plant, a processing plant, a compressor
station and the associated pipework over a stretch of 530 km in the Sahara desert.
At the start of 2006, Uhde received the order for the maintenance
work to be carried out at the Libyan natural gas plant, the Wafa
Desert Plant, and commissioned MAN Ferrostaal as a subcontractor
to supply industrial personnel to carry out maintenance work,
including repairs and modifications at the plant. In addition, MAN
Ferrostaal is providing and running the entire desert camp facilities
and the necessary infrastructure for both its own and Uhde’s
personnel. Most of the workers were on site by the end of April. Since
then, the maintenance works have been running according to plan.
The order will take 23 months to complete, after which ENI Gas
may decide in favour of the provisional extension option to
continue the work. MAN Ferrostaal have been active in the Libyan
market for 30 years, largely in the context of assembly projects,
and no also for maintenance works. The company therefore has
the flexibility to respond to requirements in both areas.
Anna Fontaine

MULTILAYER FILM PRODUCTION IN ARGENTINA
SEVEN AT
ONE STROKE!
Fresh food on the table – this is what all consumers desire and
what all manufacturers want to provide, even if the goods have
to be shipped from Argentina to Europe. To make this possible,
MAN Ferrostaal recently delivered high-tech machines made in
Europe for the production of multilayer film to IPESA, one of the
larger Latin-American manufacturers of plastic film for packaging.
The Argentinean company IPESA – RIO CHICO S.A., one of the
largest Latin-American manufacturers of flexible plastic film for
agricultural and food products wants to produce 7-layer sheets of
film with a lay-flat width of 200 cm. This 7-layer film provides
excellent protection for food products by providing a barrier
against oxygen and other gases. A high sun protection factor is
also incorporated into the film.
Their search for an experienced mechanical engineering company
to provide equipment to enable the manufacture of multiplayer
film led IPESA – RIO CHICO straight to KIEFEL Extrusion, Germany
and MAN Ferrostaal Argentina.
TARGET MARKET ARGENTINA
In January 2006, the complete 7-layer film production unit was
approved in the factory in Tierra del Fuego and began production
without further delay. The unit, manufactured in Worms in
Germany, has been spitting out approximately 350 kg of film an
hour ever since. The total capacity will serve the domestic market.
Thanks to the more than successful introduction of the new
production unit and the high demand for this type of film, the
Management at the plastics company is now also looking to new
markets beyond Argentina’s borders.
Helen Vollrath
THE ECHO 1/2006 41
services & logistics
Production of High-quality 7-layer plastic film using German technology.

42
01
EXTENSION OF A COCOA PRODUCTION FACILITY
BROWN GOLD FROM GHANA
Cocoa and gold are Ghana’s most valuable natural resources. The small West-African country is the second-largest producer
of cocoa worldwide. The government in Ghana has set itself the goal of processing up to 40% of the country’s cocoa beans
domestically. This not only creates jobs. The increased net output ratio will also boost profits. The industry is therefore currently
investing in cocoa processing plants.
02
03

MAN Ferrostaal and its partners are extending and modernizing
the existing cocoa production facility of the Cocoa Processing
Company Ltd. (CPC) in Tema in southern Ghana. The process will
be completed in a number of different phases. CPC is one of the
leading companies in the region and the market leader in cocoa
processing in Ghana. The company’s product portfolio includes
cocoa mass, cocoa butter, chocolate and cocoa drinks. Up to 95%
of its products are sold in the USA, Europe and Asia. Five percent
are sold on the domestic market.
The first phase of the project involved the construction of a new
plant for the production of cocoa mass. The production line was
officially opened in November 2005. The ceremony was attended
by the Ghanaian president, John Agyekum Kufuor. This means
that the Cocoa Processing Company Ltd. now boasts one of the
largest and most modern facilities of its kind in Ghana. The new
production line is extremely efficient, and will allow 24,900 tons
of top-quality cocoa mass (cocoa liquor) to be produced annually
from 30,000 tons of cocoa beans.
In the second phase, which is already underway, the existing
facility will be completely renovated and equipped with new
machinery to further boost the production of cocoa butter and
cocoa powder. The company aims to increase its total annual
output from 25,000 to 65,000 tons once this second phase has
been completed. Two cocoa butter presses have already been
installed and the machinery and equipment required to
renovate the existing facility are already on site. Commissioning
of the facility is scheduled for August 2006.
NO. 1 ASSET
Cocoa is Ghana’s most important asset and regularly makes up
30 to 40 percent of the country’s total export revenue. 13 percent
of the country’s GDP depends on cocoa beans. Ghana produces
some 20 percent of all cocoa produced worldwide. There are
approximately 1.5 million cocoa farmers in Ghana, mostly working
on family-owned farms. In the 2003/2004 season, approximately
750,000 tons of cocoa beans were harvested. This was a record
harvest in the history of cocoa production in Ghana, which goes
back more than 100 years. Cocoa beans are traded on the soft
commodities market. The price per ton is currently 1.500 US dollars.
Renate Matthes
04
THE ECHO 1/2006 43
services & logistics
01. Street scene in Accra
02. The packaging department at Cocoa Processing Co.
03. Collecting the cocoa mass
Foreground: J.A. Danso, Production Manager at CPC
04. Unloading cocoa beans at CPC
EXTENSION AND RENOVATION OF THE COCOA PROCESSING
COMPANY LTD PLANT IN TEMA, GHANA
Value of contract: 21 million euros
Scope of supply and services provided by MAN Ferrostaal:
>> Modification and renovation of the existing facility
>> Planning and delivery of machinery and equipment for the
production of cocoa mass, including the necessary infrastructure
(such as a water treatment system, emergency
power generating sets and steam and compressed air
networks)
>> Supply of a replacement parts package
>> Supervision of the installation
>> Supervision of commissioning
>> Training
>> Technology partners: Bühler AG (Switzerland), F.B.
Lehmann Maschinenfabrik GmbH (Deutschland), B.V.
Machinefabriek P.M. Duyvis (Netherlands

44
services & logistics
01
LEADING COLUMBIAN PRINTER
GOES LARGE
Printer Colombiana, leading producer of high-quality books and magazines, confides part of its printing operations to the
extra-large format technology from MAN. The machine that will be used is the MAN Roland 904-7B XXL.
A vast and completely empty warehouse is
the image that comes to mind when Juan
Guillermo Giraldo, CEO of Printer
Colombiana, remembers his job interview
with Gerhard Schropp 30 years ago. The
German businessman showed the young
engineer the spaces where his machinery
would soon be printing the thousands of
books and magazines to meet the demands
of a reading boom sweeping many Latin
American countries at the time.
Gerhard Schropp was in charge of setting
up Printer Colombiana in Colombia, a
business that would mainly produce
books. The sales platform of the Círculo de
Lectores, then owned by the Bertelsmann
Group, whereby books could be paid for
in instalments, sparked an enormous
interest in reading throughout the region.
Colombia was chosen as a strategic
location for printing and meeting that
demand.
The once-empty space, located in an industrial
area in Bogotá, is now full of the
smells of ink and paper and the constant
sounds of printing presses and a team
of professionals hard at work. This team
makes Printer Colombiana the leading
producer of books and magazines in
Colombia, and the sixth largest on the
Latin American market.

After three decades, this Colombian printing
house – currently owned by Bertelsmann
and El Tiempo, the country’s largest
newspaper – has updated its technology and
processes. With exports to other countries
in the region accounting for almost
70 percent of production, the plan is to become
market leader.
AN ENDURING ALLIANCE
Through IPP Colombia, a subsidiary of
MAN Ferrostaal, MAN Roland has collaborated
with Printer Colombiana since the
company’s beginnings, providing technological
consulting and support as well
as financing support to allow for the
modernisation of the company’s production
operations. In 1981, the company
acquired a MAN Roland Rekord 4-color
press to produce books and “later, in the
90s, we made the leap to LITHOMAN and
ROTOMAN rotary presses for our magazine
production. Now we are daring to move on
to large-format, sheet-fed machines with
our purchase of a new Roland 904-7B XXL
press, the first of its kind in Latin America
and also the first within the Arvato Group,
Bertelsmann’s printing division,” says
Printer Colombiana’s CEO, summing up his
company’s technological evolution.
Printer Colombiana will use the new press
primarily to produce high-quality books.
However, with its colour and large-format
capacity, it will also support printing of a
variety of commercial products. “This
machine is state-of-the-art. It will allow us
to work with large formats, handle large
volumes and ensure excellent performance
and quality levels,” insists Juan Guillermo
Giraldo.
TECHNOLOGY FOR GROWTH
Colombia and other countries in the
region, such as Peru, Ecuador and almost
all Central American nations, are currently
experiencing a restructuring of their
economies and the implementation of free
trade agreements with the United States.
Leading businesses in the region, like
Printer Colombiana, are aware of the need
to take advantage of these agreements to
break into the North American market and
increase business opportunities. One such
strategy is to undergo modernisation
processes allowing for “renovation of
equipment and machinery in order to keep
up with the technologies best suited to
international markets,” in the words of
Juan Guillermo Giraldo.
02
THE ECHO 1/2006 45
The purchase of the large-format press
marks Printer Colombiana’s entry into the
world of MAN Roland technology for sheetfed
large-format printing (120 x 162 cm)
and will allow the company to strengthen
their position as one of Latin America’s
leading printers of books.
Investment in this technology reflects an
obvious awareness of market tendencies
and the service options and quality offered
by MAN Roland and MAN Ferrostaal. “Our
decision was based on our enduring
relationship of trust with the manufacturer
and with IPP Colombia. We train our
personnel in Germany and depend on
direct, permanent and real-time support
from the factory to solve any problems
that arise with our press,” says Giraldo.
Today, after 30 years with Printer
Colombiana, the empty space he once contemplated
with Mr. Schropp has become
for Giraldo the place where his career
began and from which he was able to move
the company on to the position it enjoys in
the market today: a position of leadership
achieved together with their clients,
employees and suppliers.
Germán Gonzáles
01. Roland 904 XXL at Printer
Colombiana
02. Juan Guillermo Giraldo, CEO
of Printer Colombiana, relies
on the Roland 904-7B XXL for
the production of high-quality,
full-colour books.

46
services & logistics
BRAZILIAN PRINTERS INVEST IN ROLAND 500
UNBEATABLE FOR SMALL PRINT RUNS
With the five-colour printing press from MAN Roland, printers can easily respond to spontaneous customer needs.
The flexible sheet-fed press prints 18,000 copies per hour.

The Intergraf printing works in Pernambuco
is the first in this region in the northeast
of Brazil to use a ROLAND 500.
Intergraf was founded in 1995 and is
renowned for providing its customers with
printing solutions that unite art, innovation
and state-of-the-art technology. Intergraf
is one of the most up-to-date and efficient
commercial printers in Brazil.
Before it purchased the five-colour sheetfed
offset press from MAN Roland, Director
Eduardo Mendonça Filho was able to see
the ROLAND 500 in production. “My son
visited printing works in São Paulo and Rio
de Janeiro, which had exactly the same
sheet-fed press that we now own,” he
explains. “We never purchase equipment
on this scale without first performing
a thorough analysis,” he explains. “Technology,
performance, product support and
price were all taken into account.”
INCREASING PRODUCTION
Small and medium-sized print runs are
one factor in the graphic arts industry that
must be given serious consideration when
making decisions on investments. Danilo
Storti Garcia, Commercial Director of
Gráfica e Editora Sarapuí Ltda, a printing
works that specialises in the packaging sector,
knows this very well. In order to
sustain its position as one of the leading
printers in the market, the Storti Garcia
family insisted on quality and stat-of-theart
technology. “We were looking for agility,
efficiency and fast responses,” explains
Danilo. In February of this year, the
ROLAND 500 was put into operation at the
Sarapuí printing works. Sarapuí intends to
boost its production by 40 percent with
the new machine.
The demand for various products with
small print runs is also increasing rapidly
in the packaging segment. “In the past,
costs were always a problem whenever we
took on jobs with small print runs.” Danilo
explains that he first came across the
ROLAND 500 at the Drupa international
trade fair in 2004. At the end of that same
year, he travelled to Germany to meet with
MAN and the European printers that use
the ROLAND 500 for production.
CUTTING-EDGE TECHNOLOGY
“That sealed the deal for us.” He explains
that the directors at Sarapuí were also
considering other suppliers. “We were looking
at other competitors but in the end we
decided to go with MAN Roland because we
recognised that their technology had the
edge over other presses in the same class.”
The new press has already demonstrated
its potential. “We noticed the difference
straight away. The technology and speed
are incomparable”, says Danilo. “The press
is fully computer-assisted and user friendly.”
And the praise doesn't end there.
According to the director, the printing
works' production capacity will be boosted
by up to 40 percent thanks to the new
equipment. “First, we want to provide our
existing customers with an improved service
in terms of quality and price. After that, we
will be broadening our horizons,” Danilo
insists. “Our commercial department has
put a lot of effort into increasing acceptance
among customers, and we are now starting
to reap the fruits of their labour. This is
coming at exactly the right time, now that
the ROLAND 500 has boosted our capacity.”
Today the printing works services customers
in the capital city of São Paulo, within
THE ECHO 1/2006 47
VERSATILITY
The Roland 500 is particularly suitable
fur use in the market for small and
medium-sized print runs. Its special
59 x 74 cm format ensures greater
efficiency. Its settings are high-precision.
Spoilage in the printing process is reduced.
The Roland 500 unites productivity and
quality and is equipped with cuttingedge
automation technology, including
control panel settings with a connection
to printnet networking software
(PECOM).
The printing press has a speed of 18,000
sheets per hour. The new plate change
technology of the coating module significantly
reduces the time taken to change
plates.
the state of São Paulo, and in regions in the
south and northeast of the country.
Sarapuí's major customers are in the
pharmaceutical industry and account for
60 percent of production.
Dr. Thomas Kaup

48
services & logistics
INTEGRATED SERVICES IN THE PRINTING AREA
“WE HELP KEEP OUR
CUSTOMERS PROFITABLE”
With its Intergrafica Print and Pack (IPP) business, MAN Ferrostaal is the world’s largest independent service provider for the
graphic arts industry. With more than 50 offices in Latin America, Africa, Central and Southeast Asia, IPP represents a sales platform
for the printing industry.

MAN Ferrostaal offers an integrated service
portfolio in the printing area along the
entire value chain, from process analysis to
machine optimisation.
Together with MAN Roland Druckmaschinen,
IPP is pursuing a global “3S service strategy”,
in particular in the area of sheet-fed presses,
in large markets like Brazil, Mexico, South
Africa, Turkey and Malaysia. This 3S focuses
on service, spare parts and supplies. With
the help of the machine support program,
customers will be able to achieve the shortest
possible setup times and the highest levels
of product quality.
All of these services go hand in hand
throughout the entire life cycle of a printing
works. This Life Cycle Management (LCM)
means that the operational costs of a printing
system are optimised and reduced over
its entire life-time thanks to individual
packages of measures.
Approximately half of the more than 700
employees at IPP work in the service area.
Their range of services encompasses:
Consulting, project management, instruction,
training, refitting, maintenance, repairs,
spare parts supply, chemicals and consumables,
as well as financing. Customers have
a single point of contact, from setup to
printing and further processing.
THE ECHO 1/2006 49
“Our activities are centered around business
models that help keep our customers
profitable. It is important to us to create
added value for our customers, so that they
can increase productivity and improve
quality. To do this, we must focus on direct
customer benefits,” says Dr. Thomas Kaup,
Managing Director of Intergrafica Print &
Pack GmbH.
ENHANCING THE SERVICE PORTFOLIO
The entire value chain is placed under the
microscope and optimised. Production is
made more efficient, a sustained increase
in printing capacity is effected, print setup
times are reduced, processes are integrated
with inline solutions, value-enhancing
auxiliary applications are integrated into
the machines, quality is comprehensively
controlled, production costs are lowered
(fewer staff, less waste and consistently
high quality). The production process is
made more efficient by software connecting
the automation modules.
Kaup says “Our goal is to enhance our customers’
portfolio of products and services
for their customers, which will allow them
to stay even further ahead of the competition.
Shorter lead times and lower setup
costs for the production run enhance the
economic elasticity of the printing systems.”
Helen Vollrath

50
financing
PLANT FINANCING IN CHILE
A MODEL FOR SOUTH AMERICA
Six years ago, MAN Ferrostaal negotiated a contract with the Chilean company EMPRESA NACIONAL DE PETROLEO (ENAP) for the
turnkey delivery of a diisopropyl ether plant. The project was the first in a series of joint projects with unusual financing concepts.
The financing of the latest project, a delayed coker, was awarded the title of most important project-based financial operation of
the year 2005 in Latin America by the internationally renowned financing magazine “Project Finance International”.
When the state-owned Chilean oil company
ENAP made plans for the construction of a
diisopropyl ether (DIPE) plant in 2000, it
was looking for a general contractor willing
to provide long-term investment and capable
of implementing a very challenging
financing concept. Edzard zu Knyphausen,
Managing Director of MAN Ferrostaal
Chile, describes the initial situation: “Right
after our initial discussions, ENAP and
MAN Ferrostaal agreed that there was
potential for further joint projects. The
financing structure of the DIPE project did
not fit into any of the usual financing categories
of Project Finance or Corporate
Finance. On the one hand, private financing
was to be part of the investment but,
on the other the state-owned ENAP wanted
to retain full operational and entrepreneurial
control.”
In order to secure long-term financing,
ENAP, MAN Ferrostaal and other partners
founded a project company acting as
owner, borrower and operator of the plant.
After the successful realization of the project
and financing concept, the DIPE plant
was completed on schedule in September
2003. Soon there were additional contracts
following the same pattern: two desul-
phurization plants (2002), one mild hydrocracker
(2004) and, in 2005, the contract
for a delayed coker, a refinery plant for the
conversion of very heavy hydrocarbon
molecules into lighter products.
LONG-TERM PARTNERSHIP
The contracts between ENAP and MAN
Ferrostaal in a consortium with the Spanish
partners Foster Wheeler Iberia S.A. and
Técnicas Reunidas S.A. and ENAP for the
turnkey delivery of a delayed coker including
utility systems were signed and put into
effect in July 2005.
Similar to the earlier projects, these not
only cover the delivery of a plant, but also
the implementation of a complete project
and financing concept, including a longterm
share in equity of the established
project company, which is to run for 20
years. This project company acts as owner,
operator and borrower and provides the
end customer ENAP with the production
capacity of the plant as part of a financial
lease concept.
The structure of all ENAP contracts follows
this concept. While the total investment
volume of the DIPE project was still less than
30 million US dollars, the investment for the
construction of the mild hydrocracker

exceeded 100 million US dollars. For the
construction of the delayed coker, the partners
developed a financing concept for an
investment volume of 430 million US dollars.
Financing packages for the mild hydro
cracker and the delayed coker, amounting
to over 540 million dollars in total, were
arranged and internationally syndicated in
New York. Both financing concepts were
well oversubscribed, which proves the
attractiveness of the business model and
Chile as a location of industry and commerce.
In 2005, the financing of the
delayed coker was given the title “Latin
America Deal of the Year 2005” by the internationally
renowned financing magazine
“Project Finance International”. The project
was seen as “the most important projectrelated
financial operation of the year
2005 in Latin America”.
49%
ENAP Group
TASK FORCE IN MADRID
Process licensor for the delayed coker
is Foster Wheeler, a well-known plant
constructor from the USA. Foster Wheeler
Iberia, Madrid, and Técnicas Reunidas,
Madrid, are responsible for the full
engineering. The equipment is delivered
by Foster Wheeler, Técnicas Reunidas
and MAN Ferrostaal. For this reason,
a temporary project company (Union
Temporal de Empresas) was established
in Spain, with MAN Ferrostaal owning
a stake of one third. This company
executes the non-Chilean part of the
contract from its Madrid location. A task
force was established at Foster Wheeler
Madrid into which the MAN Ferrostaal
project team was also delegated. The
project management as well as all purchasing
of equipment will be executed from
there.
CAPITAL OWNED – INVESTORS
51%
MAN Ferrostaal 17%
Foster Wheeler Iberia 17%
Técnicas Reunidas 17%
PROCESSING SERVICES CONTRACT
ENAP Refineria Aconcagua
OPERATION AND MAINTENANCE CONTRACT
ENAP Refineria Aconcagua
LEASING CONTRACT
ENAP Refineria Aconcagua
FINANCING
ENERCON S.A.
PROJECT COMPANY
THE ECHO 1/2006 51
For the local tasks in Chile, the consortium
partners established a joint venture in
Santiago de Chile. The Chilean subsidiary
of MAN Ferrostaal, DSD Chile, is responsible
for the construction and assembly of the
complete plant.
Helmut Mühlemeier
PLANT DELIVERY CONTRACT (TURNKEY)
Consortium Foster Wheeler, Técnicas
Reunidas, MAN Ferrostaal
CAPITAL BORROWED
Credit international
Banking syndicate

52
financing
01
ENAP: LARGEST REFINERY CAPACITY ON
THE PACIFIC COAST
The state-owned company ENAP, with
annual sales of approximately 6.7 billion
US dollars and a profit of approximately
200 million US dollars (2005), is one of the
largest companies in Chile. As a strategically
important company, it is fully state
owned. ENAP operates plants in three
main locations: Punta Arenas, Talcahuano
(Concepción) and Concón and enjoys a
market share of 90% in the petrochemicals
market (petrol, diesel, aviation fuel,
asphalt). With a processing capacity of
approximately 100,000 barrels of crude
oil per day, the Concón refinery is the
main supplier for the Santiago region.
With its refineries, ENAP has the largest
refinery capacity on the pacific coast.
Santiago suffers from high traffic emissions,
a problem which is exacerbated by its
geographic location in a basin, which
makes air circulation difficult in certain
weather conditions. Against this backdrop,
the Chilean government pursues a strict
environmental policy with increasingly
rigorous emission reduction requirements.
The installation of the delayed coker as
well as the previous projects in which
MAN Ferrostaal acted as an investment
partner for ENAP were realized as part of
a long-term expansion and modernization
programme. The objective of this program
is to produce more clean fuels with
reduced emissions in order to further
improve the quality of life in the metropolis.
THE DELAYED COKER PROCESS
In the delayed coker process, oil sludge
and other viscous residues produced
during vacuum distillation (an oil processing
step) are converted into the valuable substances
liquefied petroleum gas (LPG),
gas, naphtha, diesel and petroleum coke
by rapid heating to approximately 540°
Celsius and subsequent transfer into special
containers (coke drums). Petroleum coke
is a valuable solid substance which can
be burned in power stations to generate
Construction Activities at the
Diisopropyl Ether Plant in Chile:
01. Installation of subsoil piping
02. Surveying
03. Earthwork
04. Pile driving
02
energy or used in the aluminium industry
to produce anodes, given appropriate
quality.
Due to their low proportion of short-chain
hydrocarbons, heavy crude oils yield less
high-quality products in the refinement
process than light crude oils. They also
produce more residues, which is why the
price of heavy crude oils on the global
market is lower than that of light crude oils.
The delayed coker converts these
residues into valuable products while
increasing the distribution of light oil products
and improving the product quality as
well as the efficiency and profitability of
the refinery.

THE ECHO 1/2006 53
CUSTOMER:
Energía Concón S.A. – ENERCON
VALUE OF CONTRACT:
300 million US dollars
CONTRACT INCLUDES:
Main plant:
>> Delayed Coker 20,000 bpd
Auxiliary plants:
>> Petroleum coke transport system
>> Amine recycling plant
>> Washing system for separation of
sulphurous gases
>> Sulphur recovery plant
>> Wastewater treatment plant
>> Flare
>> Operation media
>> Plant connections
>> Control room
PLANT LOCATION:
Concón, within 2.5 hours’ drive to the
northwest of Santiago de Chile
COMPLETION TIME:
28 months
03 04

54
financing
“WE COMBINE FINANCING AND
OPERATIONAL RESPONSIBILITY”
MAN Ferrostaal offers customers a range of financing solutions to help them realise projects. In the interview below, Jens Gesinn,
Executive Board Member with responsibility for Finance, Accounting, Controlling and IT, gives some examples of the main financing
options available and outlines the essential features of each.

Mr. Gesinn, MAN Ferrostaal and its partners recently received
an award for the financing of a petrochemical plant in Chile
(see the article on page 50). What was so special about this
financing package and why did it receive an award?
The greatest challenge in this project was finding a way to incorporate
private capital into a new plant that was to be owned and
operated by the Chilean state-owned company ENAP [Empresa
Nacional del Petroleo]. This demanded a financing concept that
was fully tailored to suit the needs of the customer and the
particular situation.
And MAN Ferrostaal managed to do just this.
Yes. We and our partners made this a reality. Admittedly, we had
previously worked on similar projects for the same customer and
we were able to tweak and improve the model from one project
to another. We have lots of experience of customizing financing
concepts for individual customers.
Can you describe a typical financing concept?
For MAN Ferrostaal, there is no such thing as a typical financing
concept. In fact, that is the defining characteristic of our financing
solutions. They are always tailored to our customers’ individual
needs. Our financing options assume different forms, depending
on the sector, region and project. What they all have in common
is that they form an essential foundation for our business.
So you always start from scratch with each new financing
project?
No, of course not. We have certain prototypes. Broadly speaking,
there are three different types of financing concepts that we can
offer our customers: Project financing for large plants, export
financing for machines, and advance financing in the area of
steel logistics. We will leave aside the financing of production
plants in our automotive segment for the moment because this
involves investing in our own means of production.
The most individual type of financing is probably used in the
industrial plants business.
That’s correct. The industrial plants business is certainly very
complex. We focus on the construction of large plants and very
clearly on project financing, where we can play a very important
role. We occupy a unique position in the market as a processindependent
constructor of large plants and engineering company
with a project management focus. Our most important capability
in this area is that we develop projects from the ground up,
and sound financing models are an essential component of this.
This is exactly where our strength lies and what attracts customers:
We combine financing expertise and operational responsibility,
THE ECHO 1/2006 55
and can therefore judge very well what makes for a sound project
and how it can best be realised.
Who are MAN Ferrostaal’s partners on these kinds of projects?
We have been collaborating for years with KfW (the Reconstruction
Loan Corporation) and Hermes and this has worked very
well. For example, all methanol plants in Trinidad with a total
volume of 2.5 billion were completed with the help of these partners.
But we have also used these partners to get many other
projects up and running. The construction of these kind of plants
would be inconceivable without the necessary financing.
However, we also work with a range of foreign credit institutions
and credit insurance providers, depending on what combination
of partners makes the most sense in each case.
Our track record must be pretty long then.
Indeed it is. We have been doing this for about 25 years. But we
still employ a flexible approach. Financing models that may have
worked well yesterday and today are not necessarily a recipe for
success in tomorrow’s projects. Innovation is essential, and with
our new Board Members Dr. Knothe (Projects and Contracting)
and Dr. Lesker (Service and Sales), both of whom previously
worked very intensively on financed projects, we are most
definitely looking forward in order to conceive new financing models.
Which areas require new financing models?
New technologies, for example. This is perfectly illustrated by
the example of biodiesel and renewable energy form, but power
plants also require new financing models on an ongoing basis.
There are many projects in this area, but also a huge demand for
financing. Financing plays a crucial role in new technologies that
have not yet been tried and tested in the market. The risk
involved in employing new technology in a plant also requires
new market mechanisms. Not everyone is willing to invest their
own private capital in such a venture. With these kinds of projects,
we try to come up with financing models that spread the financing
risk among various parties. This is the very essence of project
financing: Placing the burden of risk on several different shoulders,
so that everyone feels their own share of the risk is acceptable
and everyone can enjoy watching the project unfold. However, we
are not indiscriminate when it comes to projects involving new
technologies. We select opportunities where we can asses the risk
and where the benefits are obvious.
How does MAN Ferrostaal distinguish itself from the competition
in the area of project financing?
According to the definition of the VDMA (Verband der deutschen
Maschinen- und Anlagenbau – the German Engineering Federation),

56
financing
MAN Ferrostaal is not strictly a large plant engineering and
construction company. According to VDMA, you must spend
several million hours each year on purely engineering activities
to earn that title. This isn’t the case for MAN Ferrostaal. In other
words, we are not a builder of large plants according to the strict
definition. Rather, we are a project developer and arranger. This
is our role. It is true that we have no proprietary engineering and
construction processes. In this regard, we are at a competitive
disadvantage compared with the renowned plant engineers
when it comes to projects that are put out to tender and where
the financing is already in place. In this case, we can’t compete
with companies that have proprietary procedures. If a company
says “I have already earned enough money to cover my next
chemicals plant and I am going to use my profits to build this
plant,” we have no added value to offer compared with our competitors.
Our business lies wherever there is potential for new
industrial projects to be developed from the ground up. This
project development market is huge, and there is rich potential
for new plants all over the world. This is where we have the
advantage of being much more flexible than the competition.
Wherever a project is possible, where there is a business plan and
where the feasibility is clear, we can put together the ideal technology
and financing package.
And who decides whether or not a project is feasible?
This question is examined both by us and by the partner credit
institution. We examine the economic basis for the project independently
of each other and, happily, we usually come to the
same conclusions. These are always highly dependent on the
various parameters of each individual project. Take, for example,
petrochemical plants in the area of natural gas. The composition
of the gas in the earth can be a crucial factor in determining
which technical procedure to use for further processing. If we
were an plant engineering and construction company with only
one procedure, this could put us out of the picture straight away
if the gas is “wrong” gas for our procedure. MAN Ferrostaal has
more flexibility because we bring together the best partners for
the job and then implement the project with an intelligent
financing model. Large plant engineering and construction
companies are technology-driven and try to develop their sales
based on technology. In contrast, we try to achieve successful
sales based on financing. We are very well positioned to do so,
as is confirmed by banks.
Is financing also important in the machines and transport business?
Yes, though not to the same degree. Financing makes just barely
half of our machine business possible. We act as an exporter and
we finance machines and transport solutions for our customers over
a period of up to five years. There is a particularly high demand
for our financing solutions in South America and Asia. We mainly
finance in euros and US dollars, but sometimes also in yen.
Why do customers use us for financing instead of their local
credit institutions?
We can offer better conditions. We take out insurance cover for
our customers and we then grant the customers loans based on
this cover – at extremely attractive interest rates. Currently, we
can offer approximately 6 percent. In South America, for example,
where interest rates of 15 to 30 percent are the norm, our rates
are incredibly attractive.
What happens where a customer is from a country where the
currency is unstable?
Then there is naturally a currency risk, which is borne by the
customer. However, we can master this scenario in most cases.
An extension often helps the customer get through a temporary
shortfall. If the currency of a country drops in value and the
liabilities in the local currency rise as a result, the repayment
term can be extended until inflation has counterbalanced the
currency deterioration and the purchasing power of the currency
is essentially restored. The risk of currency deterioration has
become much smaller over the last 20 years, not least because
the control measures of the World Bank have been greatly improved.
Governments today no longer get into spiralling levels of
debt as they once did. Our export credit, which we also provide
without insurance cover in certain cases (that are subject to
rigorous scrutiny), gives us a very clear advantage over competitors
because not many companies in the machine business
segment can offer customers the same deal.
Is that why MAN Ferrostaal has such a wide-ranging portfolio,
in particular in the printing press area?
One reason is the financing solutions we can offer, not only for
MAN Roland presses, but also for individual presses from other
companies from different countries. The other reason is, of course,
our ability to bring various manufacturers together under one
umbrella. This is traditionally one of our key strengths because
we have been doing it for so many years. We don’t make our own
products. Instead, we represent other companies, as we have
always done.

SUPPLIER CREDIT OFFERS LOWER INTEREST RATES
SIMPLE AND INEXPENSIVE
Supplier credit is very common in Latin America in particular, and customers often ask about it in the context of machine deliveries.
With supplier credit, the supplier grants the foreign customer a term of credit. In this way, the customer avoids impacting its credit
limit at its bank and enjoys considerably lower interest rates.
Supplier credit has several advantages to offer customers
purchasing goods and services. The euro and US dollar interest
rates are considerably lower than annual interest rates for local
currencies, which may be anything up to 30 percent (in Brazil, for
example). In addition, it takes much less time to sign an agreement
on payment terms than to do all the necessary paperwork to
secure a bank loan. By safeguarding the due receivables with supplier
credit insurance cover, MAN Ferrostaal ensures that customers do
not have to worry about the debt during the normal course of
business.
However, customers cannot escape some administrative charges
if they avail of supplier loans. For credit assessment purposes, for
example, customers must present up-to-date, audited balance
sheets and profit and loss statements to the supplier and, if the
loan is backed by (tangible) collateral, they must cooperate for the
entire term of the loan.
Cash payment agreements are always preferable. For MAN
Ferrostaal, supplier credit offers few advantages because the
granting of loans and keeping track of debt always means high
administrative costs. Moreover, supplier credit has a negative
impact on MAN Ferrostaal’s balance sheet ratios.
Karl-Heinz Schröter
THE ECHO 1/2006 57

58
news
>ESSEN: STUDENTS MEET DR. MATTHIAS MITSCHERLICH
AN INTERVIEW WITH THE CHAIRMAN OF THE BOARD
On 14 February 2006, senior grammar-school pupils were given a
second opportunity to ask Dr. Matthias Mitscherlich questions about
both his professional and personal life. The series of events entitled
“Dialogue with Youth” is organised each year by the Initiativkreis
Ruhrgebiet (Ruhr Initiative). It aims to convey economic realities
and career opportunities in a practical way to students preparing for
university-entrance exams through personal contact with Executive
Board Members of international companies.
Mitscherlich answered questions from the students, most of which
related to apprenticeship and career opportunities at MAN Ferrostaal.
The international nature of the company was the subject of much
interest. Many of the questions related to options and opportunities
for temporary employment abroad. The students were particularly
keen to know the criteria according to which employees are selected
for foreign assignment and what prerequisites they must fulfil.
Dr. Mitscherlich informed them that key characteristics of future
employees include a very good knowledge of at least one foreign
language and an appreciation of and interest in cultural diversity.
When asked whether an academic degree or an apprenticeship
would be preferred, he strongly recommended completing a degree.
The international and multi-faceted character of the company means
that MAN Ferrostaal is focusing on applications from graduates.
New employees are encouraged to develop their potential in all areas:
Engineering, management, finance, sales and logistical planning.
Anna Fontaine
>GRADUATE CONGRESS:
RAISING OUR PROFILE AMONG GRADUATES
MAN made use of the graduate congress on 23/24 November 2005
in Cologne, Europe’s largest recruitment fair for students, to appeal
to qualified university graduates. The MAN Group was presented
using the new corporate design, and its stand attracted a lot of
attention from young graduates.
MAN Ferrostaal, which sees its employees as one of its most valuable
resources and the basis for its success, also used the graduate fair as
a platform for raising its profile and for making contact with potential
future employees.
KAZAKH MINISTER INTERESTED IN
STRATEGIC ALLIANCES
Aset Issekeshev, Junior Minister for Industry and Trade in the
Republic of Kazakhstan expressed an interested in direct
investment by foreign partners during his visit to MAN
Ferrostaal in Essen. Accompanied by a trade delegation from
Kazakhstan, he explained the goals of Kazakh economic policy.
The focus is currently on reducing the dependency on the
raw materials industry, and on the diversification and development
of the Kazakh economy. Key areas are farming and
foodstuff processing, oil and gas, tourism, the textile industry,
metallurgy, transport and logistics and building materials. The
Minister is keen to pursue strategic alliances with renowned
companies, which will enable the transfer of technology to
Kazakhstan.
In addition to MAN Ferrostaal’s single machine business, the
contract for a gas compressor station in “Opornaya” in western
Kazakhstan with MAN TURBO is worthy of mention in this
context. There is a strong demand for piping materials with
the expansion of the oil and gas industry. MAN Ferrostaal
Piping Supply has already closed a contract to supply fittings
for a sea-water cooling system for the Aktau power plant.
Udo Völker

MAN AG
MAN SELLS TAKRAF FÖRDERTECHNIK
MAN AG is selling the MAN Ferrostaal subsidiary Takraf
Fördertechnik GmbH. The buyer is VTC Industrieholding
GmbH in Munich. Neither company has disclosed the sale
price.
In the fiscal year 2005, Takraf, based in Leipzig, traded
profitably and registered a turnover of 122 million euros with
a workforce of 485. The company manufactures equipment,
systems and complete installations for open cast mining, porthandling
and crane technology and bulk materials handling.
The company has a sales and distribution network covering all
five continents, and offers an end-to-end portfolio of services
in its field, from development and engineering to manufacturing
and assembly. The company is particularly renowned for its
open cast mining products, and almost half of all bucket-wheel
excavators in the world were produced by MAN Takraf.
THE ECHO 1/2006 59
The company became part of the MAN Group in 1994, when
MAN consolidated its own materials handling activities with
those of TAKRAF Lauchhammer GmbH.
With the sale of Takraf, MAN Ferrostaal is continuing on its
course of focussing on its core business. In 2004, the company
disposed of none-core business to the value of 214 million
euros and 1,400 employees. This year and next, the company
plans to dispose of other non-core areas with a turnover value
of 180 million euros and 800 employees.
Daniel Reinhardt

60
>MAN FERROSTAAL CELEBRATES 50 YEARS IN COLUMBIA:
A COUNTRY WITH SPECIAL MARKETS
Columbia is the country in Latin America in which MAN
Ferrostaal has gained the strongest foothold and in which the
company’s reputation is best established. After 50 years in the
country, Columbia is now considered to be one of the company’s
“traditional” markets.
In Columbia, MAN Ferrostaal operates in fields that the company
has pursued to the same degree in almost no other country in the
world, notably the pump business. For decades, people in Bogotá,
Columbia’s capital, said that every drop of water that came out of
a pipe had passed through one of the pumps delivered by MAN
Ferrostaal. Of course, sometimes it didn’t come because the completion
and maintenance of the water supply for a city of 5 million
people presented extraordinary challenges to the suppliers and
technicians.
FIRST SUBSIDIARY OPENS IN BOGOTÁ
On 2 December 1955, MAN Ferrostaal opened its first subsidiary in
Bogotá in an office in the city centre. Herbert Jendrach, Managing
Director for 24 years, left his stamp on all of the activities he oversaw.
After the sale of rail cars to the national railways and MAN busses
to the public transportation services in Bogotá, Ferrostaal de
Colombia Ltda. entered the market for pumps, valves and large
slide gates for waterworks. The overseas office sold and assembled
large components for deep wells and, in this field, became the
most important representatives worldwide of the manufacturer
KSB, one of the leading suppliers of pumps, valves and associated
systems. Four other offices were established in Cartagena, Cali,
Medellin and Neiva.
The sale in the 1970s of two submarines built by HDW in Kiel
marked the Columbian office’s largest order to date. The successful
completion of this order provided the basis for a long and fruitful
relationship with the Columbian Navy, which has placed orders
for marine research vessels, corvettes and cost-guard surveillance
systems. In 1986, José Huerga took the helm as Managing Director
and steered the Columbian office through 16 more successful
years. He saw through the merger with Intergrafica, a company
with 35 years of experience in the printing press market in Latin
America.
40 EMPLOYEES
Since 2002, Camilo Martinez has been in charge of an office of
40 employees and has been implementing projects relating to the
same and assembly of machines and components, Industrial
Systems and Transportation, Marine Systems, Materials and
Printing & Packaging. The most important orders include the supply
of pumps, valves and large slide gates for the country’s waterworks,
as was the case 40 years ago. Orders for submarine spare
parts are currently in process. MAN Ferrostaal de Colombia Ltda.
supplied the Columbian Central Bank with Schuler presses for
coin minting at the end of 2005.
COOPERATION
To complete these order, MAN Ferrostaal’s overseas offices works
in close collaboration with other companies within the MAN
Group. As part of a current project with an order volume of
4 million US dollars, MAN Ferrostaal de Colombia will deliver and
assemble a MAN B&W engine with a capacity of 3,000 kilowatts.
Meanwhile, the Navy has placed a delivery order for five MAN
B&W generators for two ships.
Frank Hoffmann

TEXTILE EXPO, UZBEKISTAN, TASCHKENT
05. – 08/09/06
> FIRST NATIONAL TECHNOLOGICAL ENCOUNTER OF THE
OIL INDUSTRY, MEXICO, CANCUN
30/08/06 – 03/09/06
> ELECTRA MINING, SOUTH AFRICA, JOHANNESBURG
11. – 15/09/06
> INNO TRANS 2006, GERMANY, BERLIN
19. – 22/09/06
> MINING WORLD CENTRAL ASIA, KASACHSTAN, ALMATY
20. – 22/09/06
> ITM, BULGARIA, PLOVDIV
25. – 30/09/06
> 48. BRNO INTERNATIONAL ENGINEERING FAIR,
CZECH REPUBLIC, BRNO
18. – 22/09/06
> KIOGE, KAZAKHSTAN, ALMATY
03. – 06/10/06
> TIB 2006 TARGUL INTERNATIONAL TEHNIC BUCURESTI,
ROMANIA, BUCHAREST
03. – 07/10/06
> AGROPRODMASH, RUSSIA, MOSCOW
09. – 13/10/06
> EXPO TRANSPORTE 2006, MEXICO, GUADALAJARA
15. – 16/11/06
> IMME, INDIA, CALCUTTA
22. – 25/11/06
> ARGENTINA GRÁFICA, ARGENTINA, LA RURAL
23. – 28/11/06
PUBLICATION DETAILS
Publisher:
MAN Ferrostaal AG
Hohenzollernstraße 24
45128 Essen/Germany
Responsible:
Daniel Reinhardt
Editing:
Helen Vollrath
Authors in this issue:
Ulrich Bange
Wilhelm Bruckmann
Anna Fontaine
Germán Gonzáles
Frank Hoffmann
Dr. Thomas Kaup
Thomas Lehmann
Holger Lexius
Renate Matthes
Helmut Mühlemeier
Walter Offner
Daniel Reinhardt
Walter Sante
Karl-Heinz Schröter
Jan Uder
Goetz Truebenbach Wolff
Burkhard Willems
Helmut Wolff
Udo Völker
Helen Vollrath
THE ECHO 1/2006 61
Picture credits:
Corbis: Cover, Page 4, 14, 17, 41 and 57
Getty Images: Page 33 and 46
Karsten de Riese: Page 10, 12, 13
Layout and execution:
Werbeagentur adtention, Essen
Printed by:
Woeste Druck, Essen
Printed with a MAN Roland four-colour
sheet-fed offset press
on Galaxi Supermat from Papier Union.
This paper is chlorine-free.
This magazine is issued:
Twice a year