1. © Copyright 2003 Frost & Sullivan. All Rights Reserved. U.S. Desalination Plant Markets Desalination Equipment Manufacturers Proactively Educate Plant Operators on New Technologies to Expand Markets Environmental Group “Most plant operators are partial to manufacturers that anticipate their needs and approach them with solutions to their technical requirements.”

2. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Industry Trends Desalination is becoming ever-more popular in the United States for the provision of fresh, potable water The 1,200 desalting plants operating in the United States produce over 300 million gallons of freshwater per day Reverse osmosis heads the pack of technologies competing in the market with a lion’s share of over 70 percent of installed capacity Technologies such as EDI and nanofiltration are becoming increasingly popular Florida, California, Texas, Carolina, Georgia, Hawaii, and Arizona are all key current and future states for desalination The majority of water desalinated is brackish water. Seawater is expected to become increasingly popular in future

3. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Industry Trends (Cont’d) Growth opportunities are good for both municipal and industrial applications The quality of water is becoming more politicized creating huge potential for growth Environmental effects of desalination can be mitigated at a reasonable cost

4. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Key Features Frost & Sullivan Provides: Detailed insights into recent developments and trends Drivers, restraints, and challenges Market sizing and competitive analysis Market forecasts and opportunity analysis

5. © Copyright 2003 Frost & Sullivan. All Rights Reserved. What We Offer Coverage: The United States Proven methodology encompassing extensive primary and secondary data and research Focused information and strategies that cover business and technology issues Credible data and analysis highlighting industry dynamics

6. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Who Will Benefit? Current Market Participants Find out how you compare to the competition Assess current and future drivers and restraints Determine and exploit market share opportunities New Entrants Analyze challenges associated with the industry Calculate time scales for strategy implementation Position yourself to capitalize on the market’s unmet needs Investment Community Analyze long-term strategies of other desalination companies Determine which participants will outperform the competition Assess attractiveness of investing in the desalination markets

7. © Copyright 2003 Frost & Sullivan. All Rights Reserved.  Advanced Environmental Water Technologies, Inc.  Ambient Technologies, Inc.  American Engineering Services, Inc.  Aqua-Chem, Inc.  Black & Veatch Corp.  Camp Dresser & McKee, Inc.  Cardinal Contractors  C.W. Roen Construction Co.  Emco Engineering  GE Osmonics  Harn RO Systems, Inc.  Hydranautics  Hydropro, Inc. Key Market Participants  IDE Technologies Ltd.  Ionics, Inc.  J.R.Filanc Construction Co., Inc.  Kurita Water Industries Ltd.  Membrane Systems Corp.  Nomura Microscience Co.  Pall Rochem Wassertechnik GmbH  Poseidon Resources  Universal Aqua Technologies, Inc.  U.S. Filter  Watek Engineering Corp.  Water & Power Technologies, Inc.  Waterlink Technologies, Inc.

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