1. HOW DOES THE WATER SYSTEM AT PALMAS DEL MAR WORK?

PDMU operates and maintain the aqueduct and sanitary sewer systems of the Palmas del Mar community. The Puerto Rico Aqueduct and Sewer Authority (PRASA) is responsible for supplying the precious liquid, which comes from the Rio Blanco (River) in Naguabo, to PDMU. The water that arrives at this community is first processed at the potable water treatment facility of PRASA. It then goes to PDMU tanks located in the Buena Vista community, where it is pumped through a pipe to Palmas del Mar. Once PDMU receives the water, part of it is distributed throughout the property, while the rest is stored in three reservoir tanks with a capacity of approximately 2 millions gallons located at Harbourlights. This represents a reserve of approximately two to three days at a regular consumption rate.

2. WHAT SERVICES DOES PALMAS DEL MAR UTILITY OFFER ITS CUSTOMERS?

PDMU counts with a private infrastructure with the task of distributing and storing potable water, as well as collecting and treating wastewater. An added benefit to the subscribers is the presence of a service office on the premises designed to cater directly to PDMU users. This office is the only authorized to process any service call. PDMU is proud to render a fast and efficient service to its customers.

3. WHY WOULD THE NECESSITY TO RATION THE WATER SUPPLY IN PALMAS DEL MAR EXIST IF WE HAVE SUCH A SOPHISTICATED SYSTEM?

In case of an emergency, if the Eastern part of the Island were to suffer a serious drought, causing the Rio Blanco (River) to drastically reduce its water flow, it would be impossible for PRASA to supply the total demand of its customers. situation such as this would prevent an adequate distribution of water service, thus affecting Palmas del Mar. Nevertheless, the PDMU reservoir system would emit the Company to take reasonable measures so that the customers of Palmas may survive the crisis. The measure that would most likely be implemented is o ration the potable water supply throughout the Palmas del Mar community, consequently, avoiding a total service interruption.

4. WHAT BENEFITS WILL THE PALMAS DEL MAR UTILITY WATER SYSTEM OFFER ITS CUSTOMERS?

Besides a more personalized, direct and immediate service, PDMU will provide then residents of Palmas del Mar the peace of mind of having a team on premises working for the benefit of the community. PDMU counts with an alternate system that permits, in case of interruptions, either due to repair or rationing, the use of its water reserve system.

5. HOW DOES PDMU CONTRIBUTE TO CONSERVING THE ENVIRONMENT?

The sewerage produced by the residents is collected and transported to the Waste Water Treatment Plant (WWTP). There, they are treated using the most advanced technology with an efficiency of 90% or more. The effluent produced disinfected and discharged in artificial lakes. Thereafter, through pumps, the water is used for irrigating the 2 golf courses and other green areas of the community. To complete the recycling process, the sludge produced by the WWTP is mixed with the grass and tree clippings of the golf courses and other green areas of Palmas to produce compost. The compost is used to fertilize the green areas and the remnants, if any, are sold to entities or individuals outside the community.

6. WHAT CAN I EXPECT IN THE FUTURE?

PDMU is currently working on different alternatives to find other sources of potable water supply in order to reduce the dependency on PRASA. A deep well was drilled in PDMPI property for the purposed of having an additional water supply with minimal treatment (chlorine injection). Yet, a laboratory analysis indicates that this well water requires additional treatment. Reverse Osmosis is being considered. In order to continue with this project, an agreement on the use of the property must be reached with PDMPI. After the terms have been agreed, the p property will be made available to PDMU through an Easement Agreement. Also, the Authority for the Finance of infrastructure (AFI by its acronym in Spanish will construct a dam in the Río Blanco (River), a project that is expected to go out for bid in June/2004. Once completed, this project will significantly contribute in assuring water supply during short or long dry periods. This project is expected to be in operation by the year 2007.