26th Jan 2007 17:46
Pennon Group PLC26 January 2007 PENNON GROUP PLC FOR IMMEDIATE RELEASE Viridor Selected as Preferred Bidder for Greater Manchester PFI Waste Contract Pennon Group Plc is delighted to announce that the Greater Manchester WasteDisposal Authority (GMWDA) today confirmed that it has selected the consortiumbetween Pennon subsidiary Viridor Waste Management and John Laing Infrastructure(a division of John Laing plc) as preferred bidder for the PFI contract todeliver long-term waste management solutions in Greater Manchester. Theintegrated waste management contract, with an investment value of around £300million, with GMWDA is the largest such scheme in the UK. Detailed negotiationsnow commence with a view to the contract becoming operational later in 2007. The Viridor/Laing consortium proposals will assist GMWDA with its obligationsunder the EU Landfill Directive, achieving high levels of materials recyclingand recovery and radically reducing the proportion of waste sent to landfill. Viridor/Laing will provide a full range of waste management services through thePFI mechanism, including waste reduction, recycling, composting, treatment,energy recovery and disposal. GMWDA currently operates and manages the UK's largest waste management contract,covering the recycling and disposal of waste from across the Greater Manchesterarea and dealing with over 1.4m tonnes of municipal waste each year.Viridor/Laing's proposals cover the provision, redevelopment, refurbishment,operation and maintenance of a number of essential facilities includingmaterials recycling facilities, mechanical/biological treatment plants, a newand an existing thermal recovery facility, transfer loading stations andhousehold waste recycling centres, as well as the provision of landfill disposalcapacity for treated residues. Commenting on the decision, Viridor Chief Executive Colin Drummond said: "TheViridor/Laing consortium is delighted to have been selected by GMWDA to delivera 'world class' waste management solution. We are looking forward to finalisingour focused proposals aiming to deliver high levels of recycling and recoveryand best value waste services for Greater Manchester in the years to come." For further details please contact : Colin Drummond, Chief Executive, Viridor Waste Management - 07831 145 157Jo Finely, Investor Relations Manager, Pennon Group - 01392 443401 or 07785 904763 Additional information: The UK is required under the EU Landfill Directive to reduce the amount of biodegradable municipal waste going to landfill sites as follows : - to 75% of 1995 level by 2010- to 50% of 1995 level by 2013- to 35% of 1995 level by 2020 Each waste disposal authority has been allocated an allowance of the amount ofbiodegradable waste it may dispose of to landfill for the years 2005 to 2020. These allowances are designed to ensure that the UK as a whole achieves therequirements of the EU Landfill Directive. Viridor Waste Management is a leading provider of essential waste and recyclingservices in the UK. It has core competencies in waste disposal by landfill, thegeneration of electricity from landfill gas and the operation of materialsrecycling facilities. It also operates waste transfer stations, civic amenitysites and composting facilities in a number of regions of the UK and has a wastecollection fleet of around 470 vehicles, a liquid waste treatment plant, and aclinical waste incinerator. Its 25 year waste management PFI with West SussexCounty Council has been operating since April 2004 and it commenced a long termwaste management PPP contract with Somerset County Council in May 2006, combinedwith the acquisition of Wyvern Waste Services from Somerset County Council. TheViridor/Grundon Waste Management joint venture is building a 400kt/32MW energyfrom waste facility at Colnbrook west of London which is due to open in thesecond half of 2008. Viridor's stated strategy is to: • capitalise on its leading position in waste disposal by landfill; • exploit opportunities in renewable energy generation; and • pursue profitable opportunities arising from the UK Government's developing waste strategy, including PFI/PPP contracts. The company has total consented landfill capacity of approximately 91m cubicmetres. This capacity is located particularly across the South, North West andEast of England, and the Central Belt of Scotland. Gas produced from landfill sites (landfill gas) is increasingly used to generateelectricity. It is a form of renewable energy and now represents around 30percent of the UK's total renewable energy generation. The UK Government'sstrategy is to increase the percentage of electricity generated from renewablesources from the current figure of around 4 percent to a target of 10 percent in2010 and 15 percent in 2015, with an aspiration of 20 percent in 2020. To meetthese targets, the UK Government has introduced premium pricing regimes, mostrecently Renewable Obligation Certificates ("ROCs"), to encourage all eligibleforms of renewable energy including landfill gas. Viridor has approximately 70MW of capacity of which 46 percent is eligible for ROCs. Viridor earned a profit before interest, tax and amortisation of intangibles(PBITA) of £35.9m in 2005/ 06 on turnover of slightly less than £300m. ItsPBITA has grown by more than 20% p.a. since 2000/01. 26 January 2007 www.pennon-group.co.uk End transmission This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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