Water. Desalination + reuse
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Canadian engineering giant Stantec acquired water business MWH Global for $795 million, back in 2016. Now that the dust has settled on the deal, how well is the integration of the two organisations proceeding, and as the global water reuse practice hits its stride, how could its work help to shape the water markets of the future? S ince Stantec's takeover of MWH Global back in 2016, the integration of the two businesses has moved at a slow and steady pace, as leadership sought to bring the best and brightest of both organisations together in a mindful and con- structive way. Now that connections are being made and new relationships forged, the size of the oppor- tunity for the business in water, and particularly in the bur- geoning water reuse market in North America, is beginning to emerge. "The estimate for capital expenditure on water reuse is in the order of $11 billion to $15 billion over the next seven to 10 years, in the US, so that is a pretty significant num - ber," says Kati Bell, global practice leader for water reuse at Stantec, and a visiting scholar at John Hopkins School of Public Health, Maryland, US. "What we're seeing is this shiŽ in the mix of reuse projects. Where historically most of them have been for non-potable reuse — reuse for cooling towers, irrigation, that sort of application — now as pres - sures continue in the urban areas, especially where we have drought conditions on and off, we're seeing an increased interest in moving away from purple pipe systems, to inte- grating that reuse into the main water supply," Bell says. Rise of reuse Bell's own career covers a lot of experience in drinking water and wastewater, including specialised work in wastewater disinfection, which "naturally rolls us into the reuse frame- work. The past 10 years of my career have been focused on the interaction between wastewater and drinking water," she says. Her perspective is that, particularly in North America, there is a gradually rising acceptance within utilities and among the wider public, that recycled water will become one of the ele - ments of a broader set of water supply solutions. A lot of the work that Stantec's water reuse practice is involved in, therefore, including in its collaborations with academic research institutions, is addressing wastewater derived constituents. "There is a huge body of research going on in that field right now. Wastewater derived con - stituents are pharmaceuticals, personal care products, endocrine disrupting compounds. The big one in the news right now is perfluorinated compounds. These are the kinds of things that we are mindful of," Bell says. This move toward greater acceptance of potable reuse in North America is supported by the introduction of more stringent water quality monitoring requirements across the states. This is one area where Stantec is drawing together the expertise that is embedded across the organisation, whether historically from the Stantec or MWH Global teams, to deliver an enhanced service. "One of my water clients is building a new facility, and they wanted to add a pretty sophisticated analytics laboratory as part of that. I was able to tap into our architectural group, which has specific experience in that sort of work, and so that was a big value add," Bell explains. "The architectural group actually designs college and university laboratory facilities, and so we can tap into that, which is great, because that's not something we in the water business do on a day-to-day basis. This is for a sophisticated drinking water treatment plant in a large urban area; and this is where we are start - ing to see this recognition of incorporating planned potable reuse into our drinking water supplies," Bell adds. Science meets finance In another example of business integration, the global water reuse practice has been working together with Stan- tec's financial experts to develop a new mechanism for industrial wastewater surcharges. "One of my clients in Tennessee added a new treatment process to be in compli- ance with a new permit. They have a plant that discharges into the Mississippi River, which has traditionally not required wastewater disinfection, because it has not been what we consider a recreational water. Now we have pres - sures that are requiring us to disinfect that water. The new process that we selected was peracetic acid," Bell explains. This meant that the conventional means of billing the client, an industrial surcharge based on biochemical oxygen demand (BOD), reflecting the cost of biologically treating the wastewater, was no longer appropriate. "We are making a switch from BOD to chemical oxygen demand (COD), in order to be equitable in distributing the additional Water. desalination + reuse March 2018 Interview 9 Kati Bell is water reuse global practice leader of Stantec, and a visiting scholar at the John Hopkins School of Public Health, Maryland, US Stantec spies opportunity in global water Stantec's strategy in water is taking shape a er its acquisition of MWH Global two years ago this month In March 2016, Canada-based Stantec, a global engineering firm operating across the US and worldwide, acquired water and environmental engineers MWH Global for $793 million in cash. The deal brought together Stantec's 22,000 people and MWH Global's staff of 6,800, to create a worldwide engineering firm with broad capabilities in water, and operating across 400 countries. The entire operation is now rebadged as Stantec, and on 1 January 2018, Gord Johnston, executive vice president of Stantec's infrastructure business, stepped up to the role of chief executive, succeeding Bob Gomes on his retirement after eight years at the helm. The Canadian company is thought to be the biggest player in the global design- build water and wastewater infrastructure market, ahead of Veolia, Suez, and CH2M (excluding revenue from operations and technology). 35% 30% 25% 20% 15% 10% 5% 0% 29% 34% 16% 21% North America consulting Rest of the world consulting North America construction Rest of the world construction STANTEC'S WATER REVENUES BY REGION 2017 estimated water revenue $1.7bn