G.F. 326 0003260
CONFIDENTIAL
exchange rate prevailing on a date to be agreed. (his figure is exclusive of land costs, client's supervizion costs and Consulting
'ngineers' fees payable by the client). This being the onse, it im essential to schievo agreement on an absolute ceiling price, which must be below 50,000 million. It is also esential for this absolute ceiling price to be circumscribed by suitable conditions of contract, and for the contractor to assume responsibility and liability for the @uccessful completion of the project.
In view of these considerations, the overnment hoe drawn up * comprehensive set of requiremente which it considers to be essential for, in some cases, desirable) elements of a singi» contruct which would ensure not only the system's financial viability, but also the muccessful completion of the project. It is the overnment's understanding that, by the latest availɛble indications, the proposals put forward by the British Group fall short of the lovern:sent's requirements in respect of the following itema:
(za)
(b)
(c)
rovisions for cost escalation must be clearly defined and limited to a pre-agreed maximum.
There should preferably be no 'unforeseen circumstances' clause: if there has to be one, claims must be limited to * pre-agreed maximn.
The consortium must state a ceiling or maximm price for th contract which will not be exceeded in may ciruumstances.
(4) The ceiling contract price must be below $5,000 sillion.
(0)
The consortium should be prepared to take over responsibility for detailed design as end when basic data and design parameters for civil works are available and performance specifications for C & M equipment are defined.
5.
I should be grateful if the British croup would consider the «bove requirements, and advise me on or before 23rd August, 1973 whether they would be prepared to enter into negotiations with the Steering Group with a view to developing a muitable contract, At this stage, the Uteering Aroup has in mind that the sequence of events leading up to the conclusion of the contruat might be along the linen of the sanex to this letter.
/.... 6.
CONFIDENTIAL