ALTERNATIVE WO : CEILING DOLLARS 5,178 MILLION
ACTUAL CONTRACT (LESS H.K ESCALATION)
HK DOLLARS 5,178 MILLION.
ALTERNATIVE THREE: ACTUAL CONTRACT (EXCLUDING ALL ESCALATION)
HK DOLLARS 3,500 MILLION.
(B) THE VARYING PERCENTAGES FOR ESCALATION WERE DELETED AND REPLACED
BY AN OVERALL BUILT IN ESCALATION OF 10 PER CENT FOR ALTERNA- TIVES ONE AND TWO CEILING PRICES, SUBJECT TO ''FORCE MAJEURE'' ESCALATION AS IN DRAFT.
4.
PRICES ALL BASED ON THE BRITISH M AND E CALCULATIONS WITH WHICH PICCAGLI FOUND ITALIANS FULLY AGREED. THEY THEREFORE DIRECTLY REFLECT ITALIAN VIEWS ON CIVIL PRICE.
5. STEERING GROUP SEEMED SATISFIED AT FIRST SIGHT WITH THE DOCUMENT FOR COUNTER-BID PURPOSE AND WITH THE PRICES INDICATED. AFTER A FEW NOT PARTICULARLY SEARCHING QUESTIONS VIRTUALLY ALL OF WHICH WERE FIELDED BY PICCAGLI ON SATURDAY THEY ADJOURNED FOR FURTHER STUDY BEFORE PROPOSING ''CLARIFICATION' MEETING FOR TODAY.
6.
AT TODAY'S MEETING STEERING GROUP ASKED QUESTIONS ON (A) COST OF ADDING IN CHATER ROAD STATION AND THE UPDATED AIR-
(B)
CONDITIONING AND VENTILATION (ANSWER WAS THAT THE TWO COMBINED ADD ABOUT HK DOLLARS 460 MILLION)
EXCHANGE RATES USED (ANSWER 12.1 FOR STERLING AND 115 FOR LIRA).
(C) WHETHER A I GROUP HAD ANY IDEAS ON HOW TO BRIDGE THE DIFFERENCE
BETWEEN HK DOLLARS 5000 MILLION (THE STEERING GROUPS ORIGINAL ''CEILING'') AND HK DOLLARS 5,876 MILLION. IN PARTICULAR HAD THEY ANY IDEAS ON RAISING ADDITIONAL EQUITY. (A I GROUP BLURRED THIS OVER AND IT WAS NOT PRESSED AS THIS STAGE)
7. AT CONCLUSION HADDON-CAVE SAID THAT THE STEERING GROUP REGARDED THIS AS AN ACCEPTABLE COUNTER-BID. THEY WOULD NOW BE PRE- PARING A DETAILED COMPARISON BETWEEN IT AND THE JAPANESE FOR SUB- MISSION TO EXCO. FOR THIS PURPOSE THEY MAY NEED TO ASK FURTHER QUESTIONS IN CLARIFICATION DURING THE WEEK. PICCAGLI IS STAYING ON UNTIL THURSDAY AND BRITISH TEAM ARE ON CALL IN TAIWAN.
8. ALL CONCERNED ARE CONFIDENT THAT COUNTER-BID WILL BE PUT FORWARD TO EXCO WITH STEERING GROUP'S RECOMMENDATION THAT IT BE ACCEPTED AS A BASIS FOR FURTHER NEGOTIATIONS IN COMPETITION WITH JAPANESE (POSITION REF A F G NOT CLEAR EXCEPT THAT THEY HAVE PUT IN SOMETHING AND ARE SEEING STEERING GROUP THIS AFTERNOON : I HOPE TO HEAR FROM THE G K N REPRESE: TATIVE TOMORROW). THERE IS
A
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