TNAG-0637-FCO40-785-Supplies-of-electricity-for-Hong-Kong-1977 — Page 104

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CONFIDENTIAL

TO PRIORITY D.T. I TELNO.CREDA 111 OF 21 JULY.

FOR MACDONALD IC2. YOUR CREDA 172. HONG KONG POWER PROJECT.

1. I HAVE NOT REPEAT NOT WRRITTTEN FORMALLY TO STONES BECAUSE YOUR DRAFT SUGGESTS THAT THE OFFER OF CEGB SERVICES IS DEPENDENT ON ACCEPTANCE OF HMG'S PACKAGE. STONES ON THE OTHER HANDS WISHES TO DEMONSTRATE TO HOWARD DUNCAN THAT THE CEGB SERVICES ARE TO BE . INCLUDED IN HMG'S PACKAGE: THE QUESTION WHETHER THEY ARE CHARGED

FOR NEED NOT ARISE AT THIS STAGE.

2. VISIT OF WEAVING, MASDING AND GILLSON APPEARS TO HAVE GONE WELL. WEAVING WILL REPORT TO YOU ON RETURN BUT THEY BELIEVE THAT THEY WERE ABLE TO PERSUADE DUNCAN OF THE VALUE OF CEGB'S EXPERTISE EVEN THOUGH HE REMAINS SCEPTICAL ABOUT THE PRICE WHICH WE CAN OFFER FOR THE EQUIPMENT. STONES CONSIDERS THE VISIT MOST VALUABLE AS A MEANS OF CLARIFYING CEGB'S RELATIONSHIP WITH CLP/PEPCO.

3. YOUR PARA.4. I DISCUSSED THIS WITH WEAVING WHO THOUGHT THAT WHILE CLP/PEPCO WOULD PREFER PACKAGE TO QUOTE PRICE FOR ALL FOUR UNITS, THE OFFER OF 2 X 350 MW WITH GENUINE OPTION ON FURTHER SETS MIGHT BE PUT FORWARD AS AN ALTERNATIVE. STONES TOLD ME THIS MORNING THAT HIS PROJECTIONS FOR POWER DEMAND CONVINCE HIM THAT ALL FOUR UNITS WILL BE REQUIRED AS PLANNED AND THAT HE WOULD THEREFORE PREFER A STRAIGHT OFFER OF THE COMPLETE ORDER.

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