GR 355
IMMEDIATE
PHER/CAT A
FM BTC HONG KONG 080845Z
CONFIDENTIAL
IN
HKK 164/1.
P.A
(267
CONFIDENTIAL
TO IMMEDIATE F.C.O TELNO.BTC 128 OF 8 DECEMBER 77,
AND TO IMMEDIATE PEKING,
INFO D.T. (FOR CRE4 AND 1.C.2).
YOUR TELNO.536: HONG KONG POWER STATION.
1. WE SHARE YOUR DOUBTS ABOUT SUCH A FULL AND SPECIFIC STATEMENT.
BUT EMRYS DAVIES (NOW IN HONG KONG) WHO WAS PRESENT WHEN LI CHIANG
SAW THE SECRETARY OF STATE FOR TRADE INFORMS ME THAT LI CHIANG
STATED IN DEFINITE TERMS THAT CHINA WAS WILLING TO SUPPLY COAL
FOR THE HONG KONG POWER STATION.
2. UNTIL DETAILS ARE WORKED OUT I DO NOT THINK WE SHOULD REFER,
IN THE POWER STATION CONTEXT, TO A SWOP ARRANGEMENT INVOLVING
U.K COAL MINING MACHINERY. HOWEVER, IT WOULD BE A HELP TO CLP
IN THEIR PUBLIC PRESENTATION OF THE POWER STATION DEAL IN HONG
KONG, IF WE COULD INCLUDE A REFERENCE TO CHINESE INVOLVEMENT. I, THEREFORE, SUGGEST THE FOLLOWING:-
}
''SUBSTANTIAL QUANTITIES OF COAL WILL BE NEEDED FOR THE NEW
POWER STATION. CLP/PEPCO ESTIMATE THAT THEY WILL REQUIRE
SOME THREE AND ONE HALF MILLION TONS PER YEAR BY THE MID-
1980'S. AS PART OF THEIR CO-ORDINATION OF PROPOSALS FOR THE
POWER STATION, H.M.G HAS, THEREFORE, BEEN DISCUSSING WITH ·
THE CHINESE GOVERNMENT AN ARRANGEMENT WHEREBY CHINESE COAL
MIGHT BE SUPPLIED FOR THE NEW POWER STATION''.
3. DAVIES'S INFORMATION (YOUR PARA.3) COMES FROM LORD NELSON
WHO SEEMED TO THINK THAT THIS WAS A GOOD REASON FOR KEEPING
QUIET AT THIS STAGE ABOUT THE POSSIBILITY OF COAL FROM CHINA.
WHILE IT IS TRUE THAT EXXON, WHO WILL HAVE A SIXTY PERCENT SHAREHOLDING IN THE NEW POWER STATION COMPANY, WILL WISH TO
BID FOR THE SUPPLY OF COAL, CLP DO NOT WISH TO BE TIED TO
ONE SOURCE AND KADOORIE IS PARTICULARLY KEEN TO INVOLVE THE
CHINESE.
14.
CONFIDENTIAL
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