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ELECTRICITY ACTIVITIESJuan José FANJUL PASTRANA

Electrical Networks-General Manager

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ContentsBackground

• First steps

• Activity Development

• Business Expansion

Our Philosophy

• A Services Company

• Diversity of Activities

• Future overall view

Our market

• Our Know-How

• Domestic Market

• International Scenery

• Keys of the future business development

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Background

First steps: • We started our activity as an

Auxiliary Company for theElectric Companies 80 years ago.

• Our initial works were carried outfor the Distribution & Transmission Linesnetworks construction, to meet the requirements

of the Local and National Electricity Boards.

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Development of the Activity• Implementation in the whole national territory in order

to meet the requirements of the Electricity Boards, “filling the holes” with the works that the Companies left aside within their more recurrent activities.

• This aspect allowed us to develop the complete business of the electricity activity, and at the same time, to conquest the international markets to increase in growth.

Background

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• When supplementing the necessities of the Electric Sector, our evolution went over the following stages:

Construction

Engineering & Construction

Engineering, Construction & Maintenance

Engineering, Construction, Maintenance & Operation

Turnkey Projects

BOOT

Background

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Business Expansion:• The current power demand, based on the self-

sustained growth, makes some important lacks appear, both for the Generation and Transmission sectors.

• The Group covers these aspects, allowing its development and expansion, as much technicaly as financially, being able to get up to the different countries where the demand increases.

Background

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SERVICES COMPANY

BUSINESS DIVERSITY

FUTURE OVERALL VIEW

Our Philosophy

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Our philosophy is based on the following fundamental

aspects:

• SERVICE TO THE CLIENT

• GEOGRAPHICAL IMPLEMENTATION

• INNOVATION

Finally, CONTINUOUS IMPROVEMENTCONTINUOUS IMPROVEMENT

Our Philosophy

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• The continuous improvement means the

development and the setting-up of:

New Tools & Machinery

New Working Methods

Staff Training & Specialization

Our Philosophy

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BUSINESS DIVERSITYBUSINESS DIVERSITY:

The maturity and the large experience acquired on the National Market, have allowed us to better undertake:

New Activities/SpecialtiesNew Business Areas

Finally, the incursion on the INTERNATIONAL SCENERY.

Our Philosophy

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FUTURE OVERALL VIEWFUTURE OVERALL VIEW:

The objectives for Energy Strategy, fixed by the

industrialized countries are among others, the following:

• POWER SUPPLY ASSURANCE

• ENVIRONMENT CONSERVATION

Our Philosophy

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Those world-wide objectives lead us to the

EFFICIENCY & EXCELLENCYEFFICIENCY & EXCELLENCY on the Energy Sectors.on the Energy Sectors.

For our business, this means the opportunity to

PERFORM & OPERATE MORE AND BETTERPERFORM & OPERATE MORE AND BETTER.

Our Philosophy

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Our Market

Our Know-How

National Market

International Scenery

Keys of the future Development

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ENGINEERING

SUPPLY & ERECTION

CONSTRUCTION

MAINTENANCE

OPERATION

Distribution

Transmission

Substations

Live-line Works

Our Market

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The development of the activities regarding Power

Transmission, is based on:

• National Branch Offices Network near the Client.

• Our Policy as a Services Company.

In addition, we can take advantage of our strategic presence to open new markets and new business areas.

Our Market

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Our Market

120 Branch Offices120 Branch Offices

922 Graduated & Engineers922 Graduated & Engineers

12,275 High Qualified Manpower12,275 High Qualified Manpower

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Scope of works

Our Market

PowerPower PlantPlant TransformerTransformer TransmissionTransmission TransformerTransformer

Industrial Transformer Commercial ConsumerCustomer Customer

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Transmission Lines CONSTRUCTION:Transmission Lines CONSTRUCTION:

Engineering

Civil Works

Assembly and Erection

Stringing, Sagging and Clamping

Commissioning

Our Market

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Transmission Lines MAINTENANCE:Transmission Lines MAINTENANCE:

• Conventional Maintenance

• “Live-Line” Maintenance. (In 1968, the Group introduced

this innovated activity in Spain, and actually we maintain

the leadership, both in Spain and abroad)

Our Market

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Some works references

Height extension on 220kV OHVLHeight extension on 220kV OHVL

OPGW OPGW stringingstringing

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220kV 220kV undergroundunderground systemsystem

220kV 220kV TowerTower erectionerection

Some works references

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FUTURE PERSPECTIVE AND STRATEGY:FUTURE PERSPECTIVE AND STRATEGY:

Construction:Construction:•• A more structured Power NetworkA more structured Power Network•• Necessity of new facilities Necessity of new facilities •• High investments on the networkHigh investments on the network

Maintenance:Maintenance:•• Territory presence with a better Territory presence with a better ““letter of introductionletter of introduction””•• Old network. ConsumersOld network. Consumers’’ sensitivity. Natural disasterssensitivity. Natural disasters

Wind Farms developmentWind Farms development•• High ratio up to 2010High ratio up to 2010

Solar Energy developmentSolar Energy development•• A sA still embryo status. Prospective value. Strong investmentstill embryo status. Prospective value. Strong investments

National Market

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Our export activity started in 70’s.

With the experience adquired, our development in theinternational scenery is based on two strategies:

• Large Construction Projects

• Permanent presence:Reinforced territorial structure

BOOT projects

International Scenery

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Our present market

ARGENTINAARGENTINA ANDORRAANDORRA ABU DHABIABU DHABIBRABRAZZILIL FRANCFRANCEE KUWAITKUWAITCHILECHILE PORTUGALPORTUGAL OMANOMANCOLOMBIACOLOMBIAECUADORECUADOREL SALVADOREL SALVADORGUATEMALAGUATEMALAHONDURASHONDURAS AALLGEGERRIAIA BANGLADESHBANGLADESHMEMEXXICOICO CAMERCAMEROOOONN CAMBODIACAMBODIANICARAGUANICARAGUA LIBLIBYYAA INDIAINDIAPANAMAPANAMA MAURITANIAMAURITANIA TTHHAILANDAILANDPERUPERU TUNTUNISIAISIA VIETNAMVIETNAMDOM. REPUBLICDOM. REPUBLIC ZAMBIAZAMBIAVENEZUELAVENEZUELA ZIMBABWEZIMBABWE

LATINLATIN AMERICAAMERICA EUROPEUROPEE MIDDLE EASTMIDDLE EAST

AFRICAAFRICA ASIAASIA

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LARGE CONSTRUCTION PROJECTSLARGE CONSTRUCTION PROJECTS

• The different opportunities are

based on:

Our Technical Capability

Our references in the market

Our financial strength

International Scenery

26800kV 800kV TransmissionTransmission LineLine -- India India

400kV Transmission Line 400kV Transmission Line Maya Riviera (Mexico)Maya Riviera (Mexico)

Some works references

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PERMANENT PRESENCE: PERMANENT PRESENCE: Territorial structureTerritorial structure

• Contracts awarding are due to:

Our territorial presence. Client proximity

Recurrent activities

Clients fidelity

Self-sustained growth

New business and activities

International Scenery

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Some works references

InsulatorsInsulators cleaningcleaning

33kV 33kV TransmissionTransmission lineline maintenancemaintenance

HeightHeight extensionextension onon 400kV OHVL400kV OHVL

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PERMANENT PRESENCE: PERMANENT PRESENCE: CONCESSIONSCONCESSIONS

• Permanent presence - System Operator

• High compensation activity

• Risk controlled

• Complete cycle of the business

• Prospective value

International Scenery

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PoPoççosos de Caldasde Caldas

CachoeiraCachoeira PaulistaPaulista

TriTriáángulongulo

ExpansiExpansióónn

Serra Serra ParacatuParacatu

Serra da MesaSerra da Mesa

Vila do Vila do CondeCondeJauruJauru

ItumbiaraItumbiara

ExpansiExpansióónn

Porto Porto PrimaveraPrimavera

RibeirâoRibeirâo PretoPreto

Concessions Concessions ChartChart

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116,405,247512P.Primavera-Dourados-Imbirussu230

840,053,1523,322(*) Operation date forecast: March, 08

203,001,034681Serra da Mesa-Paracatu-Emborcaçao (*)500

260,434,749811Itumbiara-Cuiaba500

84,774,615325Tucurui-Vila do Conde500

54,321,238181C.Paulista-T. Preto500

47,445,648212Itumbiara-Marimbondo500

Samambaia-Itumbiara-Emborcaçao

Description

73,670,621600500

Total EPC Value (€)KmKv

Concessions Concessions underunder OperationOperation

Concessions

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SomeSome referencesreferences

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586,331,3332,624

139,514,118246Serra Paracatu500

82,964,395413Sao Simao-Marimbondo-R. Preto500

109,007,031308Poços de Caldas-Ribeirao Preto500

146,954,871949Jauru-Ariquemes-Samuel230

Triángulo Transmission Line

Description

107,890,918708500

Total EPC Value (€)KmKv

Concessions in implementationConcessions in implementation

Concessions

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NEXT AUCTIONS FOR CONCESSIONS (Nov, 2007)NEXT AUCTIONS FOR CONCESSIONS (Nov, 2007)

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7

10

2

No. Of Lines

2,4594,214

1,7001,818500/230

6312,023500/230

128373230

Investment (M US$)KmKv

Concessions

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CLIENT: RED ELCLIENT: RED ELÉÉCTRICA DEL SUR CTRICA DEL SUR -- REDESURREDESUR

PERUPERU

On March 19th, 1999 the CONCESSIONARY (On March 19th, 1999 the CONCESSIONARY (RedesurRedesur) subscribed a CONTRACT with the ) subscribed a CONTRACT with the LICENSOR (Peruvian GovernmentLICENSOR (Peruvian Government--Ministry of Mines & Energy). Ministry of Mines & Energy).

Other Concessions

45,656,558435Date of operation: March, 2001

7,308,452107SOCABAYA-MOQUEGUA220

24,027,376193MOQUEGUA-PUNO220

MOQUEGUA-TACNA

Description

14,320,730135220

Total EPC Value (€)KmKv

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The position reached with the concessions management and the performance of large international projects, allow us to be more optimistic facing the Investments Plans scheduled in the countries where we have actually a permanent presence.

Our experience as well as our vocation to open new markets and to explore new activities, is the key of our growth.

Keys of the future Development