PRIORITY
Gi
240
CONFIDENTIAL.
103
CYPHER/CAT A
FM BTC HONG KONG 150911Z
CONFIDENTIAL
TO PRIORITY BTDO NEW YORK TELNO.M34 OF 14 JUNE,
INFO PRIORITY DOI (FOR BULLOCK, DEP SECRETARY AND MISS MUELLER, I.C. DIVISION).
RECE
PLEASE PASS PERSONAL FROM MACDONALD TO SIR PETER CARE RECIP. 51 AND LIPPITT OF THE DEPARTMENT OF INDUSTRY.
17 JUN 1977
HONG KONG POWER STATION PROJECT
800
HKK 16x1
S LOOKING
1. DISCUSSIONS HERE HAVE MADE IT CLEAR THAT KADOORIE FOR DIFFERENT APPROACH FROM THAT PUT FORWARD IN LIPPITT'S TELEGRAM OF 4 JUNE. WHILE ACCEPTING HMG CANNOT DIRECTLY ACT AS MAIN CONTRACTOR, CHINA LIGHT AND POWER ARE NOT INTERESTED IN PRIVATE SECTOR MAIN CONTRACTOR (E.G BALFOUR BEATTY) FOR TOTAL PACKAGE. WITHIN CONTEXT OF CAPABILITY OF BRITISH INDUSTRY TO PROVIDE TEN YEAR PROGRAMME, KADOORIE LOOKING TO HMG TO PUT FORWARD SPECIFIC CHOSEN COMAPNIES PREPARED TO PROVIDE POWER PLANT AT STATED PRICE THAT IMPLIES ACCEPTABLE PRICE PER KILOWATT OF INSTALLED CAPACITY. IN LIGHT OF BRITAIN'S BEST OFFER PEPCO WOULD DECIDE WHETHER OR NOT CAN JUSTIFY GOING FOR NEGOTIATED CONTRACT. EXXON'S STRONG COMMITMENT TO INVESTMENT IN NEW POWER STATION (THIS REPRESENTS CHANGE IN ATTITUDE BY EXXON, WHICH OWNS SIXTY PERCENT OF PEPCO) MEANS THAT PRICE NOW MUCH MORE URGENT FACTOR.
2. FULLY AGREED BY CLP AND EXXON THAT IT WOULD BE PREFERABLE FOR DEPARTMENT NOT REPEAT NOT TO VISIT HONG KONG NEXT WEEK BUT TO WORK URGENTLY ON REVISED APPROACH - INCLUDING INDICATION OF PRICE WHICH LIPPITT CAN PRESENT ON BEHALF OF HMG IN SOME WEEKS
TIMES. I AM RETURNING TO LONDON TONIGHT WITH AGREED NOTE ON NEXT STAGES: IMPORTANT THAT NO TALKS BE HELD WITH COMPANIES UNTIL I HAVE REPORTED FULLY ON DISCUSSIONS HERE.
MARCH
FILES
C
HK & GO (5)
FED
TRED
FRD
PS
PS/MR JUDD
PS/LORD GORONWY-ROBERTS PS/PUS
MR CORTAZZI
MR BUTLER
MR MURRAY
CONFIDENTIAL
ADDITIONAL DISTN
HONG KONG POWER STATION
PROJECT