Manila Water Company, Inc.

(“Manila Water” or the “Company”) holds the exclusive right to provide

water and used water services to the eastern side of Metro Manila (“Manila Concession” or “East
Zone”) under a Concession Agreement (“CA”) entered into between the Company and Metropolitan
Waterworks and Sewerage System (“MWSS”) on February 21, 1997. The original term of the
concession was for a period of twenty five (25) years to expire in 2022. The Company’s concession was
extended by another fifteen (15) years by MWSS and the Philippine Government in 2009, thereby
extending the expiry of the concession from May 2022 to May 2037.

The Company provides water treatment, water distribution, sewerage and sanitation services to more
than six (6) million people in the eastern side of Metro Manila, comprising a broad range of
residential, commercial and industrial customers. The Manila Concession encompasses twenty three
(23) cities and municipalities spanning a 1,400-square kilometer area that includes Makati,
Mandaluyong, Pasig, Pateros, San Juan, Taguig, Marikina, most parts of Quezon City, portions of
Manila, as well as the following towns of Rizal: Angono, Antipolo, Baras, Binangonan, Cainta, Cardona,
Jala-Jala, Morong, Pililia, Rodriguez, San Mateo, Tanay, Taytay, and Teresa.

Under the terms of the CA, the Company has the right to the use of land and operational fixed assets,
and the exclusive right, as agent of MWSS, to extract and treat raw water, distribute and sell water,
and collect, transport, treat and dispose used water, including reusable industrial effluent discharged
by the sewerage system in the East Zone. The Company is entitled to recover over the concession
period its operating, capital maintenance and investment expenditures, business taxes, and
concession fee payments, and to earn a rate of return on these expenditures for the remaining term of
the concession.

Aside from the Manila Concession, the Group has a holding company for all its domestic operating
subsidiaries through Manila Water Philippine Ventures, Inc. (“MWPV”). Currently under MWPV are
LagunaAAA Water Corporation (“Laguna Water”), Boracay Island Water Company (“Boracay Water”),
Clark Water Corporation (“Clark Water”), Manila Water Consortium, Inc. (“MW Consortium”), and
Estate Water, an operating division under MWPV which operates and manages the water systems of
townships developed by Ayala Land, Inc. A subsidiary of MW Consortium is Cebu Manila Water
Development, Inc. (“Cebu Water”) that provides bulk water in the province of Cebu. The Group has
other new projects in its portfolio including the Zamboanga City performance-based non-revenue
water reduction project under Zamboanga Water Company, Inc. (“Zamboanga Water”) and the Tagum
City bulk water supply project under Tagum Water Company, Inc. (“Tagum Water”), among others.

The holding company for its international ventures is Manila Water Asia Pacific Pte. Ltd. (“MWAP”).
Under MWAP are two affiliated companies in Vietnam, namely Thu Duc Water B.O.O Corporation
(“Thu Duc Water”) and Kenh Dong Water Supply Joint Stock Company (“Kenh Dong Water”), both
supplying treated water to Saigon Water Corporation (“SAWACO”) under a take-or-pay arrangement.
Also under MWAP are Saigon Water Infrastructure Corporation (“Saigon Water”), a holding company
listed in the Ho Chi Minh City Stock Exchange, Cu Chi Water Supply Sewerage Company, Ltd. (“Cu Chi
Water”) and another company tasked to pursue non-revenue water reduction projects in Vietnam
called Asia Water Network Solutions (“Asia Water”).

In addition, the Group has Manila Water Total Solutions Corporation (“MWTS”), a wholly-owned
subsidiary that handles after-the-meter products and services. Its current offerings include pipelaying,
integrated used water services, and the sale of Healthy Family Purified Water as five-gallon packaged
water in selected areas in Metro Manila.

Lastly, Manila Water Foundation, Inc. (“Manila Water Foundation”) is the corporate social
responsibility arm of the Manila Water Group. It aims to be the enabler of change that will uplift the
quality of life of the base of the pyramid (“BOP”) communities through the provision of sustainable
water and wastewater services.
WASTEWATER

Wastewater is a general term that includes all "used water" discharged by households,
commercial and industrial establishments.

Aside from providing clean and potable water to more than 6.3 million customers in
the concession area, Manila Water also provides sewerage and sanitation services to
help improve the conditions of the water environment in the metropolis and safeguard
public health.
Manila Water’s steadfast commitment to protect the environment is evident in the
magnitude and scale of the company’s efforts to ensure that domestic wastewater from
households does not contribute to the pollution of rivers and other water bodies. The
proper disposal and treatment of wastewater are essential elements of Manila Water’s
services. In the coming years, wastewater management will play an even more crucial
role, as the company extends its wastewater services to cover more areas and benefit
more people in the East Zone.

Sewerage

Sewerage services include the operation and maintenance of networks of sewer

pipelines that collect and convey sewage to a Sewage Treatment Plant (STP) which
then clean the wastewater before safely returning it to our water bodies.

In many respects, wastewater services present even greater challenges than supplying
clean, safe tap water. Centralized sewer network systems for a densely populated area
like Metro Manila entail huge capital investments and land requirements.

As an innovative solution to address the sewage and sanitation needs of its service
area, Manila Water devised a strategy to construct compact or "package" sewage
treatment plants to serve specific areas or communities where feasible. Manila Water
also utilizes the Combined Sewer-Drainage System in the collection of wastewater
from households. This strategy will utilize the existing municipal drainage system for
wastewater conveyance, thereby minimizing the laying of new sewer pipes.

Sewage coming out from households is waste produced by humans which typically
contains washing water from sinks, toilets and bathrooms, laundry waste, and other
liquid or semi-liquid wastes. These are collected via a network of sewer pipelines that
direct sewage flows to an STP. As of 2015, a total of 368.24 kilometers of sewer lines
are maintained in the East Zone. Manila Water currently operates a total of 41 STPs
with a combined treatment capacity of 317 million liters per day. A total of 172,370
households now have access to full wastewater treatment.

Treated wastewater from the STPs meets "Class C" effluent regulations and is safe for
discharge to creeks and rivers or recycled for non-contact purposes like toilet flushing,
cleaning and irrigation. The STPs operate in compliance with existing regulatory
standards of the Department of Environment and Natural Resources (DENR) and the
Laguna Lake Development Authority (LLDA). Treated wastewater help revive the
rivers where they are discharged because of their suitability to support aquatic life.

Wastewater Treatment Process

Manila Water’s wastewater treatment plants employ a technology that mimics the
nature’s way of dealing with wastes and pollution. Through a variety of mechanisms
and processes, and by using dissolved oxygen to promote the growth of bacteria that
"eat" contaminants, these treatment plants produce treated wastewater safe enough for
re-use or discharge to receiving bodies of water.

SCREENING
Wastewater passes through the mechanical screens to remove sand, grit and debris.
Raw sewage is then lifted by pumps into the head of the treatment process.

EQUALIZATION

Flow rate is controlled to prevent huge variations in volume, concentration and

temperature.

PRIMARY SEDIMENTATION

Large sediments are allowed to settle to separate clarified water. Wastewater then
flows into tanks equipped with aerators and blowers.

AERATION

The blowers supply oxygen to the tank to sustain the bacteria responsible for
decomposition of pollutants.

SECONDARY SEDIMENTATION

Biological "flocs" are allowed to settle to separate clarified water.

DISINFECTION

Harmful microorganisms are removed by the addition of sodium hypochlorite.

Treated wastewater, or effluent, then flows by gravity to the nearest water body.

Sanitation

Majority or 85 percent of households in the East Zone are not yet covered by a sewer
system and instead utilize their own septic tanks. Wastewater that accumulates inside
septic tanks are called septage. Septic tanks, if properly maintained, only provide
primary wastewater treatment. Because septic tanks provide only partial treatment,
they eventually leak out pollution into the groundwater or into municipal drainage
systems, eventually finding its way into our rivers and water bodies.

To address this, Manila Water offers sanitation services called septic tank desludging.
Sanitation services include the operation and maintenance of desludging vacuum
tankers that clean or siphon household septic tanks, and Septage Treatment Plants
(SpTPs) that receive and treat the hauled septage before disposing the treated
byproducts through environmentally safe means. Manila Water currently operates two
SpTPs, capable of treating a total of 1,400 cubic meters of septage daily.

Manila Water operates a fleet of 50 vacuum trucks that perform regular scheduled
septic tank cleaning services or desludging for communities at no added charge. This
sanitation program is carried out in coordination with barangay officials to ensure
efficient desludging service to Manila Water customers. Each household is
recommended to undergo desludging every five years to prevent healthy and
environmental hazards. Around 873,929 households have benefited from this service
since 2012.

Manila Water to inaugurate PHL’s largest

sewage treatment plant
Manila Water is set to ceremoniously energize the Marikina North Sewage Treatment Plant (STP) in
Balubad Resettlement, Barangay Nangka, Marikina City, the country’s largest STP to date.

The inauguration is expected to be attended by high-ranking national and local government officials,
Manila Water executives and construction partners. The STP is designed to treat 100 million liters per
day (MLD) of used water conveyed through a system of 22-kilometer sewer network coming from over
500,000 residents from nine (9) barangays in Marikina City and five (5) barangays in San Mateo, Rizal.
Treated effluent from the STP is categorized as “Class C” which, according to the Department of
Environment and Natural Resources, is safe for recreational water activities and marine life. This will
be discharged directly to the adjacent Marikina River.

“Built with world-class design and technology, this project is a major milestone in our efforts to
improve health and sanitation in the East Zone, as well as aid in the preservation of our rivers by
ensuring domestic used water, from the barangays it will serve, is no longer a pollutant when it is
returned to our waterways,” said Geodino Carpio, Manila Water Operations Group Director for
Corporate Operations.

The STP, which is built on over a two-hectare land, identified for this specific use with the help of the
local government, right at the banks of the Marikina River, is built 26.5 meters above ground level in
anticipation of the frequent flooding in the area. Its construction is currently marked by 6.5 million
safe man-hours without lost time for accidents, the best in a Manila Water project to date.

The STP is equipped with sequencing batch reactor (SBR) technology, a cost-efficient and space-saving
innovation, as well as with high-efficiency turbo blowers engineered to lessen the facility’s carbon
footprint. The sewer network was constructed through microtunneling, wherein pipes are jacked
across the ground from one entry pit, minimizing impact on the traffic and inconvenience to the
residents.

Manila Water is the East Zone water and used water concessionaire of the Metropolitan Waterworks
and Sewerage System (MWSS).
Project Summary
Project
The ultimate goal of this PHP 4.11 billion project was to treat all wastewater discharging into the
three major river systems (San Juan River, Pasig River, and Marikina River) from Marikina City in
the Philippines. To accomplish this, Manila Water Company would need to construct a sewage
treatment plant with a capacity of 100 million liters of treated water per day and a 23-kilometer
sewer network.

Solution
The sewage treatment plant will reduce the pollutants that are discharged into the river system
and into Manila Bay. The team used SewerGEMS to explore a wide range of possibilities in
constructing the sewer system without sacrificing service coverage. The software provided
flexibility in planning and design, which helped mitigate environmental issues.

Outcome
Using SewerGEMS, Manila Water Company was able to reduce the number of pump stations
from the originally projected 12 pumps to just three pumps, which significantly reduced the
environmental, financial, technical, and social risks involved in constructing the facilities. This
reduced the operational cost of the system by PHP 190 million. The initial estimated cost of the
12 pumps, ranging from PHP 7.2 million to PHP 20 million, will also be significantly reduced.

Software
SewerGEMS enabled Manila Water Company to speed project computations and design. The
software enabled the team to identify and anticipate potential issues, resulting in mitigation of
possible scenarios. SewerGEMS made it possible to shift from one scenario to another with
relative ease, given the complexity of the project and the number of factors affecting the
planning and design.