Confidential

Energy cost saving opportunity
by onsite energy service

November 2018
Nippon Steel & Sumikin Engineering Co., Ltd. (NSENGI)

Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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Contents

Confidential▪ Company overview▪ Onsite energy service by CHP(Combined Heat and Power)▪ Next Step

Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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1

NSENGI is the core subsidiary of Nippon Steel & SumitomoMetal, engaged in EPC and O&M businesses

Confidential

Group Total Revenue: USD 51Bil.(2017Fy）

Revenue:3 Billion USD

Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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NSENGI has 6 business domains and is strongly expanding
energy solutions business

Steel Plants● Ironmaking● Direct reduction plants● Steelmaking● Continuous casting/Processing line
● Environmental and energy saving

Marine Engineering andConstruction● Oil / Natural gas development facilities● Marine infrastructure development

Waste to Energy

Energy Solutions●Waste to energy plants●Resource recycling●Soil/Groundwater remediation●On-site energy service business●Power retailing business●Geothermal plants●Energy plants●Hydrogen Refueling Stations(HRS)

Building Constructionand Steel Structures● Comprehensive building construction● Standardized building● High-tech steel structures● Pre-engineered products

ConfidentialPipelines●On-land pipelines●Water works

Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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We have half-century history in Indonesia and contributed toIndonesia industry development
1960’sGeneral(&others)

1970’s1980’s1990’s2000’sConfidential

2010’s■1972 Nippon Steel Construction Indonesia (NISCONI)

established- For Oil & Gas development project in Indonesia■NS-BATAM established1994- For fabrication yard and shore base of our two Derrick and Lay barge

Jakarta Representative Office opened 2013 ■MarineEngineering&Construction■1968 completion for 1st Pipeline project of PT Pertamina■1974 Ballast Water Treatment Project■1974 Balongan Oil Strage Project■1981 Rantau LPG Project■1988 Bongtan LNG Piping Project
Offshore platform
South Sumatra・West Jawa gas pipeline project 2005■TOTAL Sisinubi Phase-1／EPSC3 2007■
CONOCO Phillips North Belut project 2009■

TOTAL South Mahakam 2012■

Submarine pipeline project

Steel Plant

1988 PT FUMIRA / CGL*■PT Latinusa 2011 ETL** ■PT Krakatau - NSSMC / CGL* 2014■

PT Krakatau – OSAKA STEEL 2015■
3 strip-mill projects under construction 2017- ■Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

PT Krakatau- NSSMC (KNSS)*Continuous
Hot-Dip開示範囲：社長定例報告会議出席者限り
Galvanizing Line, **Electronic tinning line
守秘区分：秘ⅡContentsConfidential▪ Company overview▪ Onsite energy service by CHP(Combined Heat and Power)▪ Next StepCopyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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5

CHP: Combined Heat and Power (co-generation)

Confidential

CHP achieves highly efficient energy use by the maximum use of waste heat generated
in power generation process.
Concept
Overall energy efficiency%

Energy balance
Conventional
power
generation
andtransmission

Power plant

Fuel
100

Factory

Electricity 40
Waste
heatTransmission
loss
CHP

CHP
Fuel10040

Waste heat 60
Factory

Electricity30
Steam50Waste heat 2080

• Cost saving through primary energy saving• CO2 emission reduction
Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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NSENGI’s on-site energy service

Confidential

Clients enjoy energy cost reduction benefits with no capital expenditure, provided withenergy by NSENGI’s subsidiary
Overview of onsite energy providing service
Client(1) Receives energy cost reduction benefits(2) Avoid opportunity loss by electric power instability(3) Saves investment fund for the further expansion of corebusinesses(4) Reduces CO2 emission
NSENGI’s subsidiary•Invests and owns
CHP facility•Provides operationElectricity
and maintenance
SteamFuelEPC
FundingEnergy ServiceFee

Fuel company

EPC contractor
Financial institution

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NSENGI successfully achieves reduction in CO2 emission as
well as energy costs* by installing cogeneration system

Potential
Client••Client whose
steam demand isover 15 t/h
Client whose
steam demand isover 5 t/h and hot
water demand isover 2,000 kwh.

Confidential

CASE EXAMPLE

CO2 emission

Energy costs

Before CHP
installation

100100After CHP
installation20%=5,000-10,000t/y(*1)

5-10%=1-5BillionIDR/y(*1)(*1) Numbers are subject to further feasibility study based on the client actual energy usageCopyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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NSENGI’s track record of construction of power plant in Japan

Confidential

NSENGI has performed many power plant projects in Japan and carried out 5 energy
service projects.
123456789101112131415ClientPlace
Power plant
Aichi
Power plantFukuoka
Chemical plant
Shizuoka
Office tower
Tokyo
Chemical plant
ShizuokaPower plantNiigata
Power plantMiyazaki
Chemical plant
Ibaragi
Power plant
Hiroshima
Power plantMiyazaki
Kumamoto☆Fuji Film
Kanagawa☆Ajinomoto
Chiba☆J Oil Mills
Shizuoka☆J Oil Mills☆Kojin Life Science Oita

Capacity
147MW BTG
22MW GE
7MW GT
40MW GT
17MW GE
110MW BTG
50MW BTG
11MW GE
11MW GE
50MW BTG
28MW GT
30MW GE
7MW GT
7MW GT
11MW GT

COD
Feb 2000Nov 2001
Sep 2002
Apr 2003
Dec 2004
Jul 2005
Jun 2006
Jan 2010
3Q 2018
1Q 2019
Apr 2006
Mar 2007
Feb 2016
Feb 2017
1Q 2019☆: Energy service projects.
Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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9NSENGI’s track record of on-site energy service in Thailand

Confidential

NSENGI has carried out on-site energy service mainly for automobile, chemical andrubber industries in Thailand

ClientFacility

Commercial
Operation Date

Honda Automobile (Thailand)

Hot water boiler &turbo chiller

July 2015

Luckytex (Thailand)6MW Gas turbine
CHP

December 2016

Yokohama Tire Manufacturing(Thailand)

6MW Gas turbine
CHPMay 2017

Honda Automobile (Thailand)

7MW Gas engine
CHPNovember 2017

Thai Honda Manufacturing

7MW Gas engine
CHPApril 2018

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Japan government support for investment cost through Joint
Crediting Mechanism

Confidential

Japan Government’s support for part of the investment cost through Joint Crediting
Mechanism provide further cost reduction benefit to client

Joint Crediting Mechanism(JCM)
Host(Indonesia)Japan
Low carbon technologies
Support part of theinvestment cost (up to 50%)

JCM projectCO2 emissionreduction••

Use JCM credits to achieve
Japan’s emission reduction
targetJCM Credit

NSENGI’s Thailand project was awarded as the 1st CHP based JCM model projectin Thailand in 2015 (CO2 emission reduction ：7,414t/y)
NSENGI has a know-how of application and acquirement of JCM subsidy

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Contents

Confidential▪ Company overview▪ Onsite energy service by CHP(Combined Heat and Power)▪ Next Step

Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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12

Project schedule (sample)

Now weare herePre-feasibility
study

Confidential

Basic
agreement

MoU
Feasibility
study

Energysupplycontract

Mechanicalcompletion

Commercial
operation

Contract
EIA / EPC

Test run

Energysupply3 months
6 months
3 months
18 ～months
3 months▪ Economic▪ Develop basic ▪ Document energy ▪ Obtain approvals ▪ Establish stableevaluation based plan/design
supply contractfrom authorities
energy supply
on conceptual
involving legal
design to▪ Reach a basic
departments▪ Build power plantunderstand order agreement offacilities
of magnitude ofenergy supply▪
Submit official
Activities cost reduction
contract draft
applications for ▪ Agree on
benefitincludinggas supply
contracts with 3rd‒Price formula
parties (fuel▪ Agree on MOU ‒Risk/responsibilit
company,
for FSy sharingfinancial
institutions)▪ “Energy Usage ▪ Single-line diagram▪ Steam piping
Survey”
Requireddatadiagram▪ Piping specification▪ Boring log▪ Building plot etc.
Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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Contents

ConfidentialThank you
Contact: Shuzo Chiba
Indonesia Branch Manager
chiba.shuuzoh.3gr@eng.nssmc.com

Copyright©2012 NIPPON STEEL & SUMIKIN ENGINEERING CO., LTD. All Rights Reserved.

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