--2-

WE HAVE VARIOUS IDEAS AS TO HOW A BRITISH PACKAGE

MIGHT BE PUT TOGETHER AND WOULD LIKE TO DISCUSS THESE

WITH YOU TO DETERMINE THE MOST SUITABLE APPROACH

FROM HONG KONG'S POINT OF VIEW. AS AN INDICATION

OF OUR THINKING WE SET OUR BELOW A POSSIBLE BASIS

FOR THE SUPPLY OF THE POWER STATION:

1.

THE EQUIPMENT AND ENGINEERING SERVICES WOULD BE OFFERED

2.

3.

4.

ON A TURNKEY BASIS BY A U.K. COMPANY (ABC LIMITED) WHOSE

SHAREHOLDERS WOULD BE LEADING CONTRACTORS IN THE POWER

INDUSTRY AND APPROPRIATE BRITISH GOVERNMENT BODIES

SUCH AS THE NATIONAL ENTERPRISE BOARD AND THE CEGB.

ABC LIMITED WOULD WORK WITH AN APPROPRIATE HONG KONG

CIVIL CONTRACTOR WHO WOULD HANDLE THE LOCAL CONSTRUCTION

WORK.

THE BUYER WOULD BE A NEW HONG KONG COMPANY (XYZ

LIMITED) OF WHICH THE SHAREHOLDERS MIGHT BE CLP,

PEPCO AND ABC LIMITED.

ABC LIMITED WOULD ENTER INTO A NEGOTIATED CONTRACT

WITH XYZ LIMITED ON THE BASIS THAT THE PRICE OF THE

IMPORTED ELEMENT OF THE NEW POWER STATION WOULD BE ON

A PAR WITH OTHER BIDS ACCEPTED ELSEWHERE IN THE WORLD

FOR EQUIVALENT POWER STATIONS REGARDLESS OF THE

NATIONALITY OF THE CONTRACTORS INVOLVED. THE RECENT

PRIA

AWARD OF CONTRACTS OF THE ASSAN POWER STATION IN

SOUTH KOREA MIGHT WELL BE A SUITABLE BASIS FOR

DISCUSSION.

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