CONFIDENTIAL
G
GEC- the nominated UK lead contractor has little nuclear
expertise and would almost certainly require the NSSS supplier to assume total contractual responsibility for the nuclear island.
29
Although Ministers do not yet have to form a view on commercial discussions which are currently in progress between GEC and prospective nuclear island suppliers, they should be aware that HMG will wish to express views. It must satisfy itself that the package being offered is credible in terms of guaranteed supply of nuclear hardware of a technical and safety standard sufficient both to perform effectively and meet general UK safety standards. Without the latter assurance the Governmor of Hong Kong could not offer an adequate defence against critics who have already started to oppose the possible siting of a nuclear power station near the colony.
30 There are three potential suppliers - KWU, Framatome and Westinghouse. KWU is acceptable technically, but is known to favour only a turnkey type of contract, which could well be unacceptable to the Chinese. Framatone designs would require technical and commercial compromises, as they could not easily meet certain of the UK safety standards. Framatome are however more likely to be disposed to assume responsibility for the whole nuclear island. To lock them into a partnership with GEC would forestall any pre-emptive bid by the French - who were earlier negotiating to sell just such a PWR to China would be "communaitaire" and could lead to partnerships
elsewhere such as Korea. The third contender, Westinghouse, is preferred from the technical and safety point of view, but is known to have an inclination to supply only the NSSS. The attitude of the American administration to the direct supply of nuclear hardware is also uncertain and cannot necessarily be relied upon.
-
31 The interrelationship with the UKs own possible PWR programme cannot however be ignored. An arrangement is being established between NNC/Westinghouse/Bechtel for the design and supply of the UK first PWR nuclear island. To build on this
- 10 -
CONFIDENTIAL