Transmission Main Leak Detection and Condition Assessment: Brazil Trade Mission 2012

1. Transmission Main Leak Detection and Condition Assessment: Brazil Trade Mission 2012

2. Corporate Overview • Formed in 2003. • Based in Toronto. • Original focus was on correlation based Leak Detection Equipment, specifically for PVC. • Developed Non Destructive pipe condition assessment technology • Changed focus to service offerings: • Leak detection for Large diameter mains • Condition assessment for ferrous and asbestos cement mains

3. Agenda • Correlation Theory Review • Echologics • Key Advantages • Leak Detection Case Studies • Condition Assessment Background • Condition Assessment Case Studies • Summary

4. Correlation Theory

5. Correlation: a Review • Old technology: proven on metallic distribution mains • Manufacturer’s began to work on plastic and other types of pipes: made claims that could not be consistently achieved! • Required a different approach to: • Sensors • Signal Processing • Amplifiers • Echologics achieved some extraordinary success, other manufacturers immediately introduced ‘trunk main correlators’, but have never achieved our level of success • Development continues; now on our 5th generation of hardware

6. Correlation Theory • Leaks make noise • Time of flight technology • Correlation function: • Leak bracketed with 2 Sensors • Leak noise takes longer to arrive at Sensor 1 than Sensor 2 • Correlator measures time difference to identify exact leak location

7. Why is Echologics Successful • Advances in sensor design, signal processing, correlation algorithms • Advances in post processing of data • Advances in field techniques • It is as much about the people, as it is about the equipment

8. Sensor development • We have done extensive R&D into plastic and transmission main sensor requirements, developed both hydrophones and accelerometers for large diameter The People • We have an intense training program and detailed field / data analysis processes • We have a young, passionate team of engineers

9. Echologics CorrelationAdvantages

10. Advantage and Disadvantages • Advantages: • Easily implemented with existing fittings • No requirement to close service take offs or laterals • No requirement to alter the flow in the pipe • Can ‘see’ leaks many km away; will find largest leaks first • Will find small leaks (typical results 2 LPM on 1500mm pipe at 3.5 bar, 1100m) • Disadvantages: • Will not find very small leaks (<1LPM) • Accuracy of location needs to be carefully verified

11. Technology Comparison

12. Leak Detection Case Studies

13. Case Study: SABESP • Leak discovered by Smart Ball Pilot • Dry hole had been dug based on Smartball location • Requested by Genival Abdias to try and pinpoint the leak • Echologics correlated the leak to within <1m accuracy 13

14. Site Location

15. Leak Location Excavation

16. Successful Leak Location

17. Case Study: United Water New Jersey • Echologics performed a transmission main leak detection pilot survey on 8km of UWNJ transmission mains • 24” to 42” diameter • Testing revealed 5 leaks • One major leak discovered on a pipeline section outside of the boundaries of the original test plan • We first saw this leak 3 km from the eventual location

18. Correlations provided evidence of leakage outside the current test area Out of Bracket Leak Detected

19. Correlation across the river crossing revealing a prominent peak 40m east of fitting on the main Isolated Leak Under a Stream

20. UWNJ 42” RCP Repair Pictures

21. Other Examples: • Thames Water, England • Bristol Water, England • Las Vegas Valley Water Department • Springfield, Massachusetts • Echologics confirmed 2 leaks that was already discovered by expensive in-pipe technologies - 36”(915mm) and 48” (1200mm) main • Sydney, Australia • Barrie, Ontario • New Orleans

22. Condition Assessment Background

23. Remaining Pipe Wall Thickness Measurement • Metallic pipes lose thickness from internal and external corrosion • Asbestos cement pipes lose “effective thickness” from aggressive waters leaching calcium out of cement and weakening walls • Physical wall thickness doesn’t change, but the pipe loses structural stiffness and strength

24. Velocity Measurement Noise Source Measure the sound velocity Wave propagation velocity (v) = D/ΔT, where ΔT is time delay between signals 1 and 2

25. Minimum1 Average2 Wall Thickness Minimum around the circumference Averaged along the length

26. Las Vegas, NV: LVVWD Pilot • Two sections of 6” AC pipe tested • .73” remaining structural thickness was measured by Echologics • Results indicated that pipe met requirements of PC200 • Excavated pipe to confirm results • Testing confirmed that our results accurately represented the remaining structural thickness of the pipe

27. Las Vegas: Velocity Measurement & Results

28. Las Vegas, NV: Excavated Pipe

29. Results of 14” lab testing

30. Pink area represents structurally sound concrete White area has lost structural integrity

31. Newark, NJ: Pilot on cast iron pipe • Pilot study on cast iron pipe installed in 1910 • Pipe had been chosen for cement mortar lining as a rehabilitation technique • Our study determined that it was highly degraded and required a structural lining • We also found a leak during the study, losing about $20,000 worth of water a year

32. Newark, New Jersey Fire Hydrant Service Leak at House #195 Average Pipe Wall Thickness of 0.18”, 63.9% loss Pit #1 - Valve Pit #2 Pit #3

33. Newark, New Jersey This is the remaining structural thickness! Confidential Use pursuant to Company instructions

34. Other Examples: • Dayton, Ohio • Sweetwater, California • Hamilton, Ontario • Chicago, Illinois • Successfully identified 3000ft section of reinforced concrete cylinder pipe with a significant number of wire breaks • Calgary, Alberta • Maple Ridge, British Columbia • Bloemfontein, South Africa

35. Summary • Echologics has pioneered the effective use of correlators on large diameter pipe, and continues to develop the technology • In North America, we are now considered a viable alternative to insertion technologies: numerous successful studies have been completed • Claims made by other manufacturers continue to throw the technology into doubt • In several projects we have been directly compared to Sahara and have found the same leaks • Our condition assessment technology can accurately determine the remaining structural wall thickness of pipes • There is return on investment from: • Prioritizing which pipes require rehab or replacement • Performing leak detection simultaneously • Ensuring the correct decision is made with respect to rehab or replacement