COMMERCIAL IN CONFIDENCE
Line to Take
Welcome NEI Projects' involvement in Indian super thermal power station project and hope progress can be maintained towards securing the
contract. Stress importance of major export projects to UK industry.
() Management of Export Contracts
the
8. However, past record of the NEI group both in competing for overseas power
generation contracts and managing these where won has been disappointing.
Despite concerted HMG support, the ineffective pursuit of export business
by NEI, and particularly NEI Parsons, has undoubtedly weakened this
company's international reputation. GEC's record of overseas contracts won in this field since 1975 (11,300MW) contrasts strongly with NEI's 1,600MW.
NEI argue that they face a Government bias towards their rival, seen in the
nomination of GEC for the Hong Kong contracts. In response, the Departments
have made clear to NEI their long-held wish to secure a significant export
contract for NEI. But the fundamental issue remains the management and
presentational problems of the company. The Department of Industry has in
the past encouraged the company to tackle these problems and may shortly embark on a further effort 7.
9.
CONFIDENTIAL
A case in point has been the Sudan Power III complex. In the absence of any
competition, NEI Projects were awarded the turnkey contract for the ODA
funded £50,000,000 Khartoum North power station. Severe inadequacies have
appeared in NEI's project management with the result that the company is 9 months late in a 27 month project timetable. ODA have recently pressed,
at very senior NEI level, the crucial need to remedy this situation given
the serious political, financial, and commercial damage which may otherwise
result to UK industry generally and to NEI who have yet to establish a
track-record in projects of this type.
Line to Take
(1) Express HMG's concern at the group's overall lack of success in winning
major power plant export orders.
a major success.
Repeat HMG's wish to help NEI Parson score
COMMERCIAL IN CONFIDENCE