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Republic of Indonesia

State Ministry for National Development Planning/National


Development Planning Agency
(BAPPENAS)

TERMS OF REFERENCE FOR:

THE PRE-FEASIBILITY STUDY AND


TRANSACTION ADVISORY SERVICES FOR
THE KABUPATEN MAROS WATER SUPPLY PROJECT

Funded under;

ADB LOAN 2264-INO (SF)


INFRASTRUCTURE REFORM SECTOR DEVELOPMENT PROJECT

JANUARY 2009
I. INTRODUCTION

The Government of Indonesia has targeted 6.8% of economic growth in 2008, slightly above the
2007 target of 6.5%. The Government recognizes that adequate infrastructure is one of the pre-
requisites for such economic growth. Due to constraints on its budget, the Government has been
aware of the urgent need to increase private sector participation (PSP) in infrastructure
development. In the last few years, the Government has attempted to do so through policy and
regulatory reforms that would create a better climate for infrastructure investment and thereby
stimulate PSP.

On the cross-sector level, the Government has issued a number of regulations. Presidential
Regulation (Perpres) 67/2005 provides greater certainty to the private sector by clarifying rules of
the game and establishing the legal framework for public-private partnership (PPP) projects. Decree
38/PMK.01/2006 issued by the Minister of Finance provides principles for the allocation of project
risks and government guarantees, while Perpres 65/2006 and Perpres 36/2005 aim at facilitating
the land acquisition process. Finally, Law 32/2003 provides greater authority and responsibility for
the regional/local governments in planning, financing, implementing, and managing regional/local
infrastructure services. However, clear implementation regulations are still needed in some areas.

As part of its efforts to accelerate the infrastructure development, the Government offered to the
private sector some 90 infrastructure projects at the Indonesia Infrastructure Summit in January
2005 and 10 model PPP projects during the Indonesia Infrastructure Conference and Exhibition in
November 2006. However, the progress with these projects has been well below the expectations,
mainly due to their insufficient preparation. Project documents do not adequately address concerns
of private investors and lenders, and lack reliable technical and financial information, particularly
with regard to risk sharing and government support.

The Asian Development Bank (ADB) is supporting the acceleration of infrastructure provision through
the Infrastructure Reform Sector Development Program (IRSDP). Bappenas, which is the Executing
Agency for the IRSDP, has established the Project Management Unit (PMU) for this purpose. One of
the IRSDP components is the Project Development Facility (PDF) that has the objective of assisting
the line ministries and local governments in financing pre-feasibility studies for PPP projects and
advisory services for the transaction execution. This assistance also aims to ensure that the PPP
projects will meet the Perpres 67/2005 principles of transparency, accountability, competition, and
public-private equality.

Local Government of Kabupaten Maros plans to develop a Water Supply system to serve the rest of
the regency. Some studies addressing the technical aspects have already been done. A build-
operate-transfer (BOT) scheme is proposed for a water supply service in Kabupaten Maros to supply
250 liters per second (lps) of drinking water. Sub-Project Appraisal Report (SPAR) and technical
feasibility study for water supply development in Kabupaten Maros was conducted in 2005. This
report concluded that, technically, 250 lps water supply project development in Kabupaten Maros is
feasible. However, the Project feasibility for through PPP mechanism needs to be further examined
to meet international standards and previous studies could be the basis for feasibility study
development .

Since PPP schemes, especially in the water supply sector, are relatively new in Indonesia, Kabupaten
Maros has requested for Bappenas assistance in preparing the Project and in guiding them through
the transaction process. These terms of reference are intended to direct the assistance of the

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Consultant in preparing the pre-feasibility study and providing transaction advisory services to
Kabupaten Maros.

II. PROJECT DESCRIPTION

a. Existing Water Supply Service

Kabupaten Maros is located just next to Kota Makassar, the capital city of South Sulawesi Province.
The South Sulawesi Province is one of the fastest developing regions in east part of Indonesia and
often considered as the central growth for East Indonesia Region. Population growth rate of
Kabupaten Maros is 1.37% per year. It has a land area of 1619.09 km² and a population of 299,662
people. Kabupaten Maros consists of 14 Kecamatan (districts). The population density is 155 people
per hectare. If the growth rate of 1.37% per year is maintained, the population will reach 325,150
people in 2013.

Table 1: Population Projection

Year Population
(person)
2007 299,662
2008 303,767
2009 307,928
2010 312,146
2011 316,422
2012 320,756
2013 325,150
Source: Kabupaten Maros, Medium Term Development Plan

PDAM Kabupaten Maros currently only operates with a 130 lps production capacity from two major
surface water (rivers and irrigation tunnel) as water sources. The main water resources are the
Bantimurung River. The water is treated in WTP Bantimurung, located 2 km away from the river
which produce 80 lps of clean water or 61.5% of the total production.

Table 2: PDAM Kabupaten Maros Water Supply Capacity

Production Percentage
Water Resource Water Treatment Plan Capacity (%)
(l/sec)
Bantimurung WTP Bantimurung 80 61.5
River
Lekopancing WTP Pattontongan 50 38.5
Irrigation Tunnel
Total 130 100
Source: PDAM Kabupaten Maros, 2007

Existing WTP Bantimurung mainly serves Kecamatan (District) Turikale and Kecamatan Lau, while
WTP Pattontongan mainly serves Hasannudin Airport Area and Indonesian Airforce Housing Complex
in Kecamatan Mandai. Only 9 out of 14 kecamatan and 28 out of 103 kelurahan (sub-district) have

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been served by PDAM Kabupaten Maros. Total existing water production only covers 12.48% of total
population in Kabupaten Maros. Basic tariff for household customer is Rp. 2,100/m3.

Ground water usage is strictly prohibited and is actually very bad (salty), especially in districts along
coastal area, such as Kecamatan Maros Baru and Kecamatan Maruso. In Kecamatan Maros Baru
itself, there are at least 10,000 households are waiting for new connections. New settlement areas
and industrial estates have been growing rapidly, especially in Kecamatan Maruso where at least
1,000 units of new houses are being developed. At present, the only choice for water supply is water
package sold by private company at the cost of Rp. 25,000 - 30,000/m3. Apparently, additional
production capacity is required to enhance clean water provision level of service in Kabupaten Maros
and as the financial capacity of PDAM and Local Government Kabupaten Maros are very limited,
private participation through PPP mechanism in enhancing the capacity is expected to solve the
problem.

Table 3: PDAM Kabupaten Maros Level of Service, 2007

No. District Area Population Connection Served Level


(Kecamatan) Width Population of Service
(km2) (person) (Unit) (person) (%)
1 Kec. Mandai 49.11 30,429 1,764 8,820 28.99
2 Kec. Maros Baru 53.76 22,445 291 1,455 6.48
3 Kec. Marusu 73.83 23,573 347 1,735 7.36
4 Kec. Turikale 29.93 35,877 3,502 17,510 48.81
5 Kec. Lau 53.73 22,321 1,076 5,380 24.10
6 Kec. Bontoa 93.52 25,090 32 160 0.64
7 Kec. Bantimurung 173.68 28,195 354 1,770 6.28
8 Kec. Simbang 105.31 22,094 54 270 1.22
9 Kec. Tanralili 89.45 23,998 57 285 1.19
10 Kec. Moncongloe 46.87 11,528 - - -
11 Kec. Tompo Bulu 287.65 13,768 - - -
12 Kec. Camba 145.36 14,236 - - -
13 Kec. Cenrana 180.97 14,283 - - -
14 Kec. Mallawa 235.92 11,825 - - -
Total 1619.09 299,662 7,477 37,385 12.48
Source: PDAM Kabupaten Maros, 2008

b. Proposed Project Development

The Project is a PPP scheme in which a private operator, based upon a 25-year concession
agreement, will build, finance, operate and transfer a 250 lps water supply system in Kabupaten
Maros. The private operator will be expected to invest approximately Rp 115 billion for the new WTP,
transmission and distribution system.

The PDAM will still operate and maintain its own transmission and distribution system. However, a
new efficient system configuration dividing PDAM Kabupaten Maros and private operator service
area needs to be determined. The PDAM might also need to finance the additional new connections
resulting from the new system configuration. Districts might be served by private operator are: Kec.

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Bantimurung, Kec. Bontoa, Kec. Lau, Kec. Maros Baru, Kec. Turikale, Kec. Simbang, and Kec.
Maruso.

Local Government of Kabupaten Maros has acquired 4,000m2 lands for WTP, however all additional
land required for the project need to be provided. In addition, Local Government also responsible for
obtaining raw water extraction permit from authorized institution. It will also arrange for all required
environmental clearances.

The water resource for the new WTP will be supplied by Jamala Spring. The raw water will be flown
about 2 km through closed tunnel from Jamala Spring to the built pond. The new WTP will be built
next to the raw water intake installation at the built pond area. Based on PDAM Kabupaten Maros
survey, the spring could reserve minimum 400 lps in summer period. Furthermore, Bantimurung
River could also be back up for long term water resource as its minimum debit on summer period is
1500 lps.

By increasing its capacity at least up to 250 lps, the level of service of clean water provision is
expected to achieve 50% of population. However, definite and the most efficient water production,
technically and commercially, needs to be analyzed through this study. Phasing of new connections
development needs also to be synchronized with the WTP capacity and service area growth. With the
proposed capacity of 250 lps, the new WTP would be able to serve around 20,000 - 25,000 potential
new connections within Kabupaten Maros.

Figure 1: Kabupaten Maros Water Supply Development Plan

Source: PDAM Kabupaten Maros, 2008

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III. OBJECTIVE

The objective of technical assistance is to assist Kabupaten Maros and/or the contracting agency in
the preparation of the Project that will be developed as a PPP. During the implementation of
technical assistance, the Consultant will improve the existing pre-feasibility study, prepare contract
documents and assist Kabupaten Maros in the transaction process, such as bid evaluation,
negotiation with the private partner and finalization of the Water Supply Concession Agreement.

IV. SCOPE OF CONSULTING SERVICES

The consulting services will be provided in two consecutive phases:

Phase I, Pre-feasibility Study and Contract Document Preparation, will include (a) system
configuration and demand-supply analysis; (b) engineering analysis, estimation of investment costs,
and socialization of results; (c) a preliminary environmental and social impact statement; (d) social
cost-benefit analysis; (e) financial modeling to reflect the operational uniqueness of the Project; (f)
preparation of contract documents; and (g) preparation of market sounding documents. The pre-
feasibility study will incorporate items (a) to (e).

In Phase II, Transaction Execution, the Consultant will present its findings and recommendations to
the Kabupaten Maros PPP Team and other relevant stakeholders to ensure their “ownership” of the
Project. Once secured, the Consultant will provide support to Kabupaten Maros during all steps of
the process up to and including financial closure.

A. Phase I: Pre-feasibility Study and Contract Document Preparation

In undertaking its assignment, the Consultant will review all previous work carried out by PDAM
Kabupaten Maros for the Project, as well as any other relevant existing studies and documents that
might aid the successful completion of the study.

a. Task 1: System Configuration and Demand-Supply Analysis

(i) Review and update 20-year domestic and non-domestic demand forecasts for the Project
(including setting an appropriate demand growth rate and calculating average water usage
for non-domestic demand), taking into account also demand for Water Supply from other
jurisdictions such as PDAM Kota Makassar;
(ii) Identify the optimum timing and phasing of Water Supply over the first 20-years of the
Project, taking into account the relevant technical, economic and financial factors;
(iii) Reconfigure the water supply system, including the determination of the optimum capacity of
the WTP, its broad technical specifications and performance standards as well as its staged
build-out, based on demand for treated water emanating from the Project; recalculate the
raw water supply, reservoir capacity, WTP and pumping system specification, taking into
account all the technical survey result including soil investigation survey result; and
recommend appropriate technology, including the most cost effective treatment process for
the raw water from the Jamal Spring and Bantimurung River;
(iv) Advise Kabupaten Maros on the optimum capacity of the transmission and distribution
network, its broad technical specifications as well as its staged build-out;

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(v) Assess the least cost construction of the network, taking into account all relevant factors
such as the transmission line pathway, location of reservoir(s), nature and use of adjoining
land and properties, site topography and potential environmental or social impacts;
(vi) Identify with maps and drawings the optimal physical configuration and phased build-out of
the network, at years 3 (end of construction), 10 and 20, indicating the capacity of the Water
Supply and the configuration of the transmission and distribution mains. Also, indicate on
the maps where the project network, including the transmission system, will interface with
the existing networks of PDAM Kabupaten Maros;
(vii)Identify, confirm, and calculate the water reserve and implication to the water balance. Also,
confirm the Project’s consistency with the national, provincial, and municipal water resources
development strategies and plans.

b. Task 2: Engineering Analysis and Estimation of Investment Costs

(i) Estimate quantities of materials and equipment, labor inputs and unit costs needed for the
Project, taking into account guidelines issued by the Ministry of Public Works (MPW). Identify
the value-added tax component of construction and other costs;
(ii) Based on the above, estimate the capital, operating and maintenance costs of the Project,
and propose its phasing;
(iii) Prepare a detailed implementation schedule for the Project in the form of a Gantt chart;
(iv) Discuss findings with the concerned local governments and PDAMs to arrive at a consensus
with regard to (a) capacity of bulk water treatment and its phasing; (b) transmission and
distribution development; and (c) interface of the project network with those of the PDAM
Kabupaten Maros’;
(v) Based on these discussions, finalize the capital, operating and maintenance cost estimates
and the Gantt chart.

c. Task 3: Preliminary Social and Environmental Impact Statement

(i) Working closely with PDAM personnel, asses the anticipated environmental impacts of the
Project. With regard to the negative impacts, describe the mitigation measures that should
be taken to minimize these;
(ii) Assess social impacts, if any, such as land acquisition, resettlement, construction workforce
impacts, operational workforce impacts, and traffic and visual impacts;
(iii) Identify whether a land acquisition plan and a resettlement plan will be needed, in line with
the Government’s regulations and requirements;
(iv) Estimate the cost of mitigation measures required for significant environmental impacts;
(v) Socialize the results to the relevant stakeholders, including the social community, in a public
consultation forum;
(vi) Based on the above activities and input from the public consultation, prepare an
Environmental and Social Impact Statement and outline any further steps needed to comply
with Indonesia’s AMDAL system.

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d. Task 4: Social Cost-Benefit Analysis

(i) Estimate the economic costs and benefits of the Project, using appropriate shadow prices
and willingness to pay of consumers;
(ii) Calculate the economic internal rate of return (EIRR) and economic net present value (NPV)
of the Project.

e. Task 5: Financial Model, Tariff Path, and Risk Analysis

(i) Develop a financial model for the Project. Using the capital, operating and maintenance costs
from the technical analysis, the cost of social and environmental mitigation measures and
other input parameters, determine the financial performance of the project. This will include
the financial internal rate of return (FIRR), debt service coverage ratios, payback period and
financial NPV. Determine the Project’s tariff options and also the bulk tariff applicable to the
other PDAMs. The model should allow an analysis of possible government support;
(ii) Review the current risk sharing arrangements used for Water Supply concessions in
Indonesia, and comment on their adherence to the general principle of allocating risks to the
party that is best able to control them;
(iii) Advise on fair risk allocation and the type of government support that may be required to
make the Project attractive to potential investors and bankable to potential domestic
lenders;
(iv) Advise on what mechanisms the local government should adopt to attract investors if no
government support is available;
(v) Estimate the amount of the support in terms of contingent liabilities arising for the
Government to make sure it does not result in an excessive fiscal exposure;
(vi) Assist Local Government of Kabupaten Maros in preparing and submitting the request for the
recommended support to the Ministry of Finance.

f. Task 6: PPP Modalities Assessment

Possible modalities will be analyzed in broad terms within the financial analysis. Concurrently,
modalities will need to be considered as they impact on both the financial analysis and the
attractiveness of the Project:
(i) Assess any asset ownership issues and potential resolutions concerning private entities and
the local government;
(ii) Recommend a preferred PPP solution with a transaction strategy, action plan, and risk
assessment.

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g. Task 7: Market Sounding

(i) Based on the results of the pre-feasibility study, prepare an Information Memorandum for
distribution to potential investors;
(ii) Assist Local Government of Kabupaten Maros in marketing the Project and facilitating the
due diligence process by potential investors;
(iii) Based on these consultations, assist Local Government of Kabupaten Maros in modifying the
technical design and financial structure of the Project, if necessary;

h. Task 8: Contract Documents

(i) Assist Local Government of Kabupaten Maros in preparing the prequalification document for
the Project; and
(ii) Draft the tender documents, Water Supply Concession Agreement and other project
documents.

B. Phase II: Transaction Execution

i Task 9: Prequalification Process

(i) Assist Local Government of Kabupaten Maros in issuing the invitation for prequalification for
the Project and evaluating prequalification applications to establish a pool of technically and
financially capable bidders;
(ii) Assist Local Government of Kabupaten Maros in publishing prequalification results,
arranging and conducting a pre-bid meeting, responding to queries raised on the draft tender
documents and Water Supply Concession Agreement, revising these documents and
agreements if necessary, and preparing minutes of the pre-bid meeting;

j Task 10: Bidding Process

(i) Assist Local Government of Kabupaten Maros in issuing the tender documents, including
the Water Supply Concession Agreement, to the prequalified bidders;
(ii) Assist Local Government of Kabupaten Maros in responding during the bidding period
through addenda to the tender documents for any further clarifications requested by the
bidders about the Project or the bidding process;
(iii) Assist Local Government of Kabupaten Maros in the legal and commercial evaluation of the
received bids by checking their substantial responsiveness to the tender documents;
determining any material deviation from the legal and commercial conditions contained in
the tender documents and Water Supply Concession Agreement; obtaining clarifications from
the bidders where necessary; recommending legally and commercially non-responsive bids
for rejection; and preparing the Letter of Intent to the preferred bidder;
(iv) Assist Local Government of Kabupaten Maros in the technical evaluation of the received bids
by determining their conformity with bid specifications and all other relevant technical and
environmental parameters; verifying project implementation schedules furnished by the

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bidders; obtaining clarifications from the bidders where necessary, and recommending
technically non-responsive bids for rejection;
(v) Assist Local Government of Kabupaten Maros in the financial evaluation of the legally,
commercially and technically responsive bids by establishing the underlying financial
assumptions used by the bidders and their conformity with the tender documents and Water
Supply Concession Agreement; verifying the consistency and accuracy of the computations
undertaken by the bidders; independently verifying the proposed bulk tariffs, based on the
evaluation criteria specified in the tender documents and using the financial model
developed during Phase I; assessing the financial strength and credibility of both equity
investors and identified underwriters of debt with respect to their commitments; identifying
financial risks, if any, to be borne by Kabupaten Maros and the Government in relation to the
project proposals of the bidders; and advising Kabupaten Maros on all commercial and
financial matters arising up to the execution of the Letter of Intent.

k Task 11: Contract Negotiations and Financial Closure Process

(i) Assist Local Government of Kabupaten Maros in preparing the negotiation strategy with the
preferred bidder that submitted the evaluated first-ranked bid;
(ii) Assist Local Government of Kabupaten Maros in concluding negotiations with the preferred
bidder within a pre-arranged time frame and within the framework of the tender documents
and the specific deviations/exceptions requested by that bidder that are in line with
accepted international norms;
(iii) Assist Local Government of Kabupaten Maros in the finalization and execution of Water
Supply Concession Agreement;
(iv) Assist Local Government of Kabupaten Maros in taking any actions required on its and the
local government’s part to make the Water Supply Concession Agreement effective; and
(v) Assist Local Government of Kabupaten Maros in monitoring the progress made by the
preferred bidder towards completing its actions and achieving financial closure.

V. REPORTING

The Consultant will submit the following documents during its assignment:

Phase I:

1. Inception Report with detail work plan (within 1 months of the commencement of Phase I);
2. Technical Report with detailed results (within 2 months of the commencement of Phase I);
3. Investment Cost Report (within 3 months of the commencement of Phase I);
4. Preliminary Social and Environmental Statement (within 2 months of the commencement of
Phase I);
5. Project Commercial Report including the Social Cost Benefit Analysis, Financial Model, PPP
Scheme, and Risk Analysis (within 4 months of the commencement of Phase I);

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6. Report on the Pre-feasibility Study incorporating items (i) to (iv) (Final Report on phase I)
(within 5 months of the commencement of Phase I);
7. Information Memorandum (within 5 months of the commencement of Phase I);
8. Contract Documents (within 5 months of the commencement of Phase I).

Phase II:

9. Prequalification Report describing the prequalification process and listing applicants that
have passed this process (within 1 month of the commencement of Phase II);
10. Bid Evaluation Report describing the bidding process, presenting in detail the technical and
financial evaluation of the bids received, and recommending the preferred bidder (within 3
months of the commencement of Phase II);
11. Water Supply Concession Agreement negotiated with the preferred bidder (within 4.5 months
of the commencement of Phase II); and
12. Final Report on the transaction execution describing the achievement of financial closure
(after financial closure).

VI. MANAGEMENT OF SERVICES

The executing agency will be Bappenas; however, the Consultant should work closely with the Local
Government of Kabupaten Maros, DG Cipta Karya in MPW, and BPPSPAM, especially on technical
matters. During implementation, the Consultants should be based on Kabupaten Maros. Bappenas
will monitor the progress of project preparation under the PDF and handle any administrative and
financing issues related to this assignment. Bappenas and Local Government of Kabupaten Maros
will evaluate the Consultant’s performance on Phase I before continuing with Phase II. The
Government has the right to terminate the contract in case the Consultant’s performance is found to
be unsatisfactory.

The Local Government of Kabupaten Maros will assist the Consultant in obtaining all currently
available data and information including relevant maps, plans, charts, previous studies and reports.
The local government will assign counterpart staff to work closely with the Consultant’s team to
ensure access to information, data and the project site, and to facilitate contacts with relevant
government agencies.

VII. ESTIMATE OF TIME INPUTS

As shown in Table 4 below, it is estimated that about 33 person-months of national consultants will
be required to provide the services specified in the terms of reference. The estimate for the pre-
feasibility study is 20 person-months, and for the transaction execution 13 person-months.

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Table 4: Breakdown of Consultant’s Inputs

Consultant Person-Months
TL/PPP Water Specialist 5
Water Engineer 3
Civil Engineer 1
Economic Analyst 2
Financial Specialist 2
Communication/Marketing Specialist 2
Social and Environmental Specialist 2
Procurement Specialist 2
Legal Specialist 1
Subtotal Pre-Feasibility Study 20
TL/PPP Water Specialist 5
Procurement Specialist 3
Legal Specialist 4
Transaction Specialist 1
Subtotal Transaction Execution 13
Total 33
TL = Team Leader

Qualification and Criteria of Experts.

1. Team Leader/PPP Water Specialist

a. Holding a Bachelor Degree (S1) in Civil Engineering and Master Degree (S2) in
Engineering/Management/Business/Economic/Finance.
b. Minimum 10 years experience as a specialist in water supply sector particularly related to
infrastructure development project.
c. Having at least 5 years working experience as a team leader of infrastructure development
project that funded by multi donors.
d. Good communication in English both written and spoken as well as reporting skills.
e. Proven ability to work independently with limited supervision and to operate effectively in a
team environment.
f. The consultant(s) must have long experience on the implementation of PPP projects in water
sector and proven to have successful during her/his services with following requirements.

2. Water Engineer

a. Minimum Bachelor degree (S1) in Civil Engineering, Master Degree (S2) in relevant area is an
advantage.
b. Having at least 8 years experience as a specialist in water supply sector particularly related
to infrastructure development project.
c. Must have experience in engineering and infrastructure management.

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d. Good communication in English both written and spoken as well as reporting skills.
3. Civil Engineer

a. Minimum Bachelor degree (S1) in Civil Engineering, Master Degree (S2) in relevant area is an
advantage.
b. Having at least 8 years experience as a Civil Engineer.
c. Must have experience in engineering and infrastructure management.
d. Good communication in English both written and spoken as well as reporting skills.

4. Economist Analyst

a. Master degree in economics.


b. Having at least 8 years of professional experience as an economist particularly in analyzes
economic feasibility of the project.
c. Having at least 5 years working experience in PPP Infrastructure Project.
d. Good communication in English both written and spoken as well as reporting skills.

5. Financial Specialist

a. Bachelor degree (S1) in finance/business administration and Master Degree (S2) in relevant
area is an advantage.
b. Having at least 10 years as a financial specialist particularly in analyzes financial feasibility of
the project.
c. Having at least 5 years working experience in PPP Infrastructure Project.
d. Good communication in English both written and spoken as well as reporting skills.

6. Communication/Marketing Specialist

a. Bachelor Degree (S1) in management marketing/communication study, Master degree (S2)


in relevant area is an advantage.
b. Having at least 8 years as a communication specialist particularly in socialization of
infrastructure project in Indonesia.
c. Having at least 5 years working experience in PPP Project.
d. Good communication in English both written and spoken as well as reporting skills.

7. Social and Environmental Specialist

a. Bachelor degree (S1) in Sanitation/Environmental Studies, Master Degree (S2) in relevant


area is an advantage.
b. Having at least 8 years experience as an environmental specialist particularly in analyzes
environmental and social impact of Infrastructure project.
c. Good communication in English both written and spoken as well as reporting skills.

8. Procurement Specialist

a. Bachelor Degree (S1) in economic or engineering (or other relevant field), Master Degree (S2)
in Engineering/management or training in procurement from institution reputable will be an
advantage.

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b. Having at least 8 years of professional experience in procurement and contract
management.
c. Familiarity with Perpres 67/2005 and Keppres 80/2003 procedures.
d. Good communication in English both written and spoken as well as reporting skills.

9. Legal Specialist

a. Bachelor Degree (S1) in Law, Master degree (S2) in Law is an advantage.


b. Having at least 10 years as a Legal Specialist
c. Have extensive experience in assisting GOI preparing contract PPP.
d. Good communication in English both written and spoken as well as reporting skills.

10. Transaction Specialist

a. Holding a Master Degree (S2) in Economic, Business Administration, or related field from a
reputable university.
b. Having at least 8 years working experience infrastructure transaction.
c. Must have analytical, negotiation and financial skill
d. Good communication in English both written and spoken as well as reporting skills.

VIII. COST ESTIMATE AND SOURCE OF FUND

The cost estimate for this consultant service is US$ 215,960 and will be funded through the
Infrastructure Reform Sector Development Project (IRSDP) under item Regional Project Development
Facility (PDF) category 1 B.

IX. RECRUITMENT METHOD FOR CONSULTING SERVICES

This service will be provided by eligible consulting firm which will be selected using Consultants’
Qualification Selection (CQS) Method under Guidelines on The Use of Consultants by Asian
Development Bank and Its Borrowers, February 2007.

X. SCHEDULE FOR CONSULTING SERVICES

Phase I should be completed within 5 months after the Consultant’s recruitment, and Phase II after
another 5 months (see Figure 2).

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Figure 2: Time Schedule for the Pre-Feasibility Study and Transaction Execution

No SCOPE OF WORK Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10

Phase 1: Pre-Feasibility Study


1 Technical Analysis
a. Demand-Supply Analysis
b. System Configuration
c. Engineering Analysis
d. Estimation of Investment Costs
2 Preliminary Social and Environmental Impact Statement
3 Social Cost-Benefit Analysis
4 Financial Analysis
a. Financial Model Development
b. Tariff Path Analysis
c. Risk Alocation and Government Support Analysis
5 PPP Modalities Assessment
6 Public Consultation
7 Pre Feasibility Study Finalization
8 Market Sounding
9 Contractual Documents Preparation
10 Reporting 1,3 2 4 5,6,7

Phase 2: Transaction Execution


1 The Prequalification Process
a. Evaluation of Prequalification Applications
b. Preparation of Bidding Proposals by Prequalified Companies
2 Bidding Process
a. Technical and Financial Evaluation of Bidding Proposals
b. Board Approval of the Bid Evaluation
3 Negotiation Process
a. Contract Negotiations with the Winning Bidder
b. Government Approval of the Agreement
c. Contract Effectiveness Conditions including Financial Closing
4 Reporting 8 9 10 11

Reporting:
1. Technical Report 8. Prequalification Report
2. Investment Cost Report 9. Bid Evaluation Report
3. Preliminary Social and Environmental Statement 10. Bulk Water Purchase Agreement
4. Project Commercial Report 11. Final Report on the Transaction Execution
5. Report on the Pre-feasibility Study
6. Information Memorandum
7. Contract Documents
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