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element of CEGB involvement.

Kadoorie had said that he was not prepared for CLP to talk to individual companies until such a package was offered. The emphasis on a competitive price was a particularly significant factor now that Esso had

Mr Macdonald said had a change of heart over the project.

he had continually reassured Sir Lawrence that both HMG and UK industry were keen to ensure that the CLP contract came to Britain. The understanding finally reached with Sir Lawrence was that, with the guidance which the meetings in Hong Kong had provided, efforts would be made in the UK to put together a package to be presented in Hong Kong in some weeks time.

In discussion the following points were made:

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it

Mr Rooney was interested to know which other elements of the project associated with the basic power station were in the offing. Mr Macdonald said that with due allowance for CLP's own uncertainty, appeared at this stage that the desalination plant was too far off to be included in present plans. The extent of both the port facilities and the transmission equipment depended on the location of the power station which had not yet been decided, although the Governor of Hong Kong had very recently proposed a site in the North East corner of Lan Tau island which appeared fairly attractive to CLP/PEPCO;

Mr Bagley enquired whether Sir Lawrence had given any indication of the price which CLP would find acceptable. Mr Macdonald said that in Hong Kong Sir Lawrence had only mentioned that he was looking for a competitive price on a "normal" basis: he

would not expect "suicidal" prices which were sometimes put forward by companies absolutely desperate to obtain orders.

In view of CLP's wish to have some extra generating capacity available by the end of 1981, Mr Bagley wondered about the implications for ordering dates

for equipment associated with the project. Mr Macdonald said that CLP/PEPCO in fact proposed to build a T10 MW gas turbine addition to their existing power station at Tsing Yi.

Mr Lippitt proposed that in the light of Mr Macdonald's report it would be necessary to talk to companies individually about the separate aspects of the project before a package could be tied together. At the same time it would also

be necessary to consider whether there could be an appropriate role for the CEGB and the NEB - although the latter seemed

a less likely instrument and the possibility of UK investment in a Hong Kong purchasing company for the power station. In discussion the following points were made:

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