CONFIDENTIAL

SIR ELLY KADOORIE & SONS.

Page

Date February 27, 1981.........

47)

Pages 9/10 - Paras. 3/1 - Dr. Marshall's statement that:

'It may be that CLP have not appreciated that if a contract is placed with the French for a complete nuclear island (a) Framatome will appoint the Architect/Engineer with CLP (b) there is unlikely to

be any technology transfer. I suspect that neither CLP nor KEC (GPC)

would welcome this'

is incorrect.

48)

The plan we have suggested provides for the Project Management Company (i.e. CLP and GPC) choosing the Architect/Engineer, thus enabling the technology transfer upon which the Chinese will insist.

49)

Page 10 Para. 3 Dr. Marshall's reference to:

persuading 'the joint utilities to go for 4-loop plants rather than 3 loop plants;

is recognized by the French who say they can meet this requirement. This, also, is only a matter of cost. However, the Feasibility Study has shown that only a 3-loop 900MW plant can be accommodated in the combined system at this time.

50)

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Page 11 Para. 2 Dr. Marshall's reference to the possibility that:

'the American proliferation attitudes will change under Reagan and the Chinese will wait until that has happened'

is, in our opinion, entirely wrong.

51)

From all indications and, in spite of China's present cut-backs on expenditure, they intend to proceed with a nuclear power station in Guangdong Province at earliest possible.

52)

In the changing scene of American politics, the Chinese do not believe that there is a chance that proliferation difficulties can be solved in the near future.

52) It would be appreciated if the contents of this letter could be placed before those who have had to consider Dr. Marshall's memorandum.

LK/m

mw

Sincerely yours,

Lawrence:

Lawrence Kadoorie

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