J P MUKHERJI & ASSOCIATES PVT. LTD.

TSFP INTRODUCTION Chapter - 1

Phase I - II Page - 1/4

TABLE OF CONTENTS

1.1 PREAMBLE ................................................................................................................ 2

1.2 PROJECT OBJECTIVE.............................................................................................. 2
1.3 METHODOLOGY........................................................................................................ 3
1.4 REPORTING............................................................................................................... 4
1.5 ACKNOWLEDGEMENT ............................................................................................. 4
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1.1 PREAMBLE

Tendaho Sugar Factory Project Site is located in the lower Awash valley of the Afar
Administrative region at about 41oE and 11.75oN. The area is laid in the semi-arid
lower Awash basin at an altitude of about 365 m above sea level. The project site is
adjacent to the Addis-Djibouti tarmac highway with a convenient distance to the port
of Djibouti and about 600 km from Addis Ababa in Northeast direction.

Water Works Design & Supervising Enterprise (WWDSE), under the Ministry of
Water Resources, Ethiopia, conducted various studies in the lower Awash basin and
confirmed that more than 60,000 ha of land is suitable for irrigation agriculture in that
region. Sufficient irrigation water could be harvested through dam construction on the
Awash River.

Accordingly, the Ethiopian government has assigned WWDSE to conduct feasibility &
design study of the dam, agricultural land & irrigation system development. After
completing feasibility study, the Water Works & Construction Enterprise (WWCE)
under the Public Enterprises Supervising Authority, would undertake the construction
of the dam, land development & irrigation infrastructure works under the supervision
of WWDSE.

The Ethiopian government has assigned Ethiopian Sugar Industry Support Centre
(ESISC) Share Company to conduct the feasibility, detailed engineering design &
undertake installation of the sugar complex at Tendaho. As a first step towards the
implementation of this objective, ESISC appointed M/s. J P Mukherji & Associates
(JPMA) Pvt. Ltd., Pune, India, as consultant for feasibility, engineering & Design
study, management & supervision of complete sugar complex.

Accordingly, the Consultants have submitted the Feasibility and Project Engineering
Document to ESISC. Detailed discussions were held with technical team of ESISC
and Consultant’s team on Feasibility & Project Engineering Document and after
discussions ESISC has approved the document and requested the Consultants to
prepare bid documents. JPMA has prepared and submitted the bid documents for
complete sugar factory to ESISC.

Later on The Ethiopian Government has assigned Tendaho Sugar Factory Project
(TSFP) to carry forward the Assignment to install sugar complex at Tendaho (The
Ethiopian Government has transferred the complete responsibilities of ESISC to
TSFP). Accordingly, TSFP has renegotiated and appointed JPMA as Consultant for
feasibility, engineering & Design study, management & supervision of complete
sugar complex.

1.2 PROJECT OBJECTIVE

The objective of the project is to establish a new sugar factory with total design
crushing capacity of 26,000 tons per day to produce about 600,000 tons/annum of
raw sugar and/or refined sugar at Tendaho Project site.

The project objective is detailed as follows:

a) Total cane processing capacity of the plant shall be 26,000 tons per day.
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b) The total capacity of 26,000 tons per day is to be achieved by installing one
single factory;

c) The sugar factory shall be designed to produce 50 % raw sugar and 50 %

refined sugar as final products

d) The factory design is to take into consideration expansion of sugar refinery in

future to 100 %;

e) Suitable capacity cogeneration plant shall be installed with the available

bagasse.

1.3 METHODOLOGY

The Consultants have prepared the Feasibility and Project Engineering Document
considering one single 26000 TCD factory with refinery and cogeneration to be
implemented in one phase, as advised by ESISC. The Consultants have also
prepared and submitted the Bid documents to ESISC considering implementation in
one phase.

Later on, as advised by The Ethiopian Government, Tendaho Sugar Factory

Project (TSFP) has taken over the Assignment and after studying the report they
have requested the consultants to prepare the bid documents by changing
Employers name & address and some commercial terms and conditions.

The Consultants submitted the revised bid documents to TSFP by changing

Employer’s name & address and revised the commercial terms. Accordingly TSFP
issued the bid documents, submitted by Consultants, to all Indian eligible bidders.

After issuing the bid documents, TSFP reviewed the sugar cane development
program and felt that it would be more pragmatic to consider and implement the
project phase-wise as mentioned below :

Phase - I - 13000 TCD

Phase - II - 26000 TCD

Phase – I of the Project is to be commissioned during crushing season 2010 – 2011

with a crushing capacity of 13000 TCD.

Phase – II of the Project to achieve full capacity from 13000 TCD to 26000 TCD. The
Phase-II to run parallel to Phase-I and commission the plant to 26000 TCD in season
2011-2012, i.e. after 1 year of Phase-I commissioning.

The consultants have accordingly revised the complete scope of supply and services
of all bid packages and informed to all successful bidders.

TSFP requested consultants to prepare a revised Project Engineering Document to

implement the project in two phases instead of one phase as submitted earlier.
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Accordingly, the Consultants had prepared and submitted the Draft Feasibility and
Project Engineering Document on 24th October, 2008. Tendaho Sugar Factory
Project had reviewed the Draft Feasibility and Project Engineering Document and
send their comments and suggestions on the report on 12th August, 2009 vide their
reference letter no TSFP04/44/326.

The Consultants has prepared and submitting this Final Feasibility and Project
Engineering Document by incorporating the comments and suggestions of TSFP.

1.4 REPORTING

The Final Feasibility and Project Engineering Document includes the following
chapters detailing each workstation of sugar plant for Phase – I and Phase – II
capacity, with project implementation schedules and manpower training.

Project Engineering Document comprises of the following:

Executive Summary

Chapters

Chapter 1 Introduction
Chapter 2 Executive Summary
Chapter 3 Basic project parameters
Chapter 4 Raw sugar plant specifications
Chapter 5 Cogeneration plant specifications
Chapter 6 Refined sugar plant specifications
Chapter 7 Plant water system
Chapter 8 Effluent treatment plant
Chapter 9 Fire protection system
Chapter 10 Manpower training & Manpower organisation structure
Chapter 11 Project implementation schedule
Chapter 12 Process consumables
Chapter 13 Civil infrastructure and Buildings
Chapter 14 Ethanol plant
Chapter 15 Financial notes

Supporting documents are provided in the annexures.

1.5 ACKNOWLEDGEMENT

JPMA extend their sincere thanks for the co-operation and support extended by Ato
Belete Alemayehu, General Manager, Ato Gebre Asrat, Factory Operations Manager,
Ato Dersey Leyew, Head, Purchasing Division and all technical & management staff
of Tendaho Sugar Factory Project in preparing this report.