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Gold/Mining/Energy : Unitec Int. Controls Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (232)	3/25/1998 8:31:00 AM
From: Link Lady	Respond to of 856

Link to article discussing Unitec & Glentel's agreement. newswire.ca

To: Bobby Yellin who wrote (232)	3/26/1998 9:25:00 PM
From: John B. Smyth	Read Replies (1) \| Respond to of 856

Selamat pagi (Good morning) Bobby, from beautiful downtown Jakarta. The first thing I noticed here was the traffic is still as congested as my last visit (April 97). On previous visits, I could see the skyline change with new construction in the heated economy each time I visited. This trip, the tower cranes are idle, but there is still a lot of hussle - bussle in the city. The hotel occupancy is down. I stay in the Ambhara Hotel in the Bloc M District. This hotel caters to Government and business. Absent are the Government officials, and far fewer expats are here. I recognized some French, Australian and U.S./Canadian accents. Occupancy seems about 50% and the flight was only 75% booked. Previously it would have been 100% respectively. According to our agent, all local financed projects are in trouble as devaluation of the currency threw purchasing costs of imported materials out of their budgets. But international financed ones are still proceeding. His business is 35% international financed, so like so many, he has adjusted his business accordingly. Interest rates are up at 70%, which is a bitter pill in the short term, but will have a corrective effect in the long term. We meet with our consortium partner over the next few days, then I leave for site tours south of Surabaya (east of Jakarta on the Island of Java). Sudarto has advised of several other IFI financed projects that he thinks we can win. total value in the $20 - 30 Million range. I will try to bring in another North American partner to bid with us. In summary, I see a nation adjusting to the new realities of the economy. As I stated earlier to Richard, Indonesia is rich in natural resources and as the world's 5th most populous nation, the largest archepelago with all the communications and transportation problems that come with it, it represents an excellent opportunity for those with the patience to ride this incipient downturn. I will post other assessments after I visit the outlying areas. Regards, John

To: Bobby Yellin who wrote (232)	3/27/1998 1:33:00 PM
From: Link Lady	Read Replies (1) \| Respond to of 856

I agree with Bobby Yellin, your work does cound exciting. The relationship with Glentel also sounds good. Would this relationship help make funding for projects(bonds + financing) simpler, as I remember you saying, that large projects over a certain amount(don't recall amount), make it harder to get financing.Do you as well have to get insurance coverage for these projects when you have winning bid?

To: Bobby Yellin who wrote (232)	3/30/1998 9:35:00 AM
From: John B. Smyth	Respond to of 856

Selamat Pagi, Bobby. Here in Malang, there is no sign of negative effects due to the monetary problems that were so visible in Jakarta. This city is primarily a University town (I would call it The Beverly Hills of Indonesia) with tourism and agriculture providing supporting economic bases. We took some pictures of a main residential area which (other than the architecture) would fit into the Beverly Hills landscape quite well. I will email copies to you when I return. Tourism is down. We had lunch at a resort hotel up the mountain, and the guide advised that their business is down 50% during the week and 30% on weekends. Other than that, this area seems to be isolated from the currency devaluation for the most part. As they do not rely on imports and generally is self sufficient I guess 10,000 rupiah is still 10,000 rupiah. I understand however that some of the North American franchises are suffering elsewhere. Apparently MacDonalds have shut down 14 of their restaurants. I saw a Dunkin Doughnut here in town that was closed. I understand that the high franchise fee and cost of import materials with the currency devaluation have priced some of them out of the market. On the other hand, I read in the paper this morning that Starbucks announced in Taiwan that they are very bullish on Asia. Today we visited the Master Station for the project here in Malang, climbed to the top of a mountain to inspect a repeater station and visited a water monitoring and a rain gauging station. Sudarto and I had dinner with a senior ministry officer this evening, who advised that one of the three other finalists confided in him that they didn't think they had a chance against Unitec. I talked to him about a new concept that I have been toying with, and he asked that we submit it in our proposal. I don't wish to reveal too much about it on the net as our competitors may be eaves dropping, but I can confidently say that it will entirely change the way Flood Warning SCADA systems will operate in the future. Tomorrow we will visit some of the Sub Master Stations and other sites. We leave at 06:00 in order to finish by 15:00 allowing time to clean up and return to Surabaya to catch our flight to Jakarta. I have meetings with senior officials with PT PLN (Persero), the national electricity utility. I think PLN is one of the institutions that has been devastated by the devaluation as most of their capital expansion projects are financed with foreign loans. I understand that their equity base has been wiped out. I will get further information when I speak with them. Selamat Jalan, John

To: Bobby Yellin who wrote (232)	3/31/1998 9:37:00 PM
From: John B. Smyth	Read Replies (1) \| Respond to of 856

I'm back in Jakarta, Bobby. Sorry I didn't post yesterday's observations, but was in the field most of the day and just had time to clean up, check out and run for the plane. By the time we arrived here in Jakarta, I was not able to get onto the hotel's internet. We visited several of the project dam sites, submaster offices and had discussions with additional ministry personnel. My confidence is building that we will offer the best technical solution. Price of course will be a determining factor in these difficult times, but the ministry personnel have requested that we propose our best technical solution first. We will look for creative ways of keeping our our proposal competitive, particularly incorporating as much local content as possible. I have a confession. On the way down from one of the sites, I played a little "hooky" and visited an onyx manufacturing facility. What a bargain place to be with a little money. I found onyx tables for Rp80,000 (US $10.00), onyx lamps Rp40,000 (US $3.50). High quality hand manufactured stone floor vases 40" high with 20" diameter at the largest, and onyx pillars 42" X 18" for Rp80,000 to Rp130,000 (US $10.00 to $16.50). Unfortunately they would not take responsibility for shipment overseas. On my next trip here I intend to do some purchasing for myself, friends and anyone else that is interested and arrange a container load. Boy, won't this posting create the DTs (pun intended). Speaking of the return trip, the schedule for submission of the proposal is May 4. I met with an official of the reviewing committee who advised they would take 2 - 3 weeks in reviewing the submissions for technical merit (this is a 2 envelope bid: 1 for technical review; 2 for financial review). The normal course would be to select the first two technical proposals for an interview, technical discussions and presentations. A recommendation is then made and the pricing envelopes are opened. If the highest technical submission is the lowest tendered price an award is made. If not, then they look at the differences in technical merit and cost to make the final determination. Here is where we will have the greatest difficulty. I have no doubt that we will make the finals as I have discussed our concepts with the senior officials and they like what we have and can offer. From reviewing published documents for this project, I believe the budget is in the US $5million range. I have meetings today with PT PLN (Indonesia's National Electric Utility) officials to discuss our previous projects, their ongoing needs and other matters that will affect their continued expansion. We have been tracking over US$700million of intended SCADA purchases with them and I wish to determine what the time frame is to implement these programs given the present monetary situation. PT Findo, our agent, has already picked up tender documents for a current project with PLN, and I will review these on the way home on Thursday. Other grass root economic signs that I have observed, Garuda (true to form) again cancelled scheduled trips fro Surabaya to Jakarta to maximize their load. This turned out in our favour as we were able to move our flight up one hour. That flight was full, service excellent. One of the regional airlines, Sempati lost 36 (leased) of their 40 aircraft and laid off 350 workers. Regards, John