TNAG-0638-FCO40-786-Supplies-of-electricity-for-Hong-Kong-1977 — Page 34

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HONG KONG PROJECT

NOTE OF A MEETING HELD ON FRIDAY 2 DECEMBER AT 3.30 PM IN ROOM 839, 1 VICTORIA STREET

Present: Mr Lippitt (in the chair)

Mr Scott GEC

Mr Davidson GEC

Mr Bagley - Babcock & Wilcox Mr Dixon Balfour Beatty

Mr Edwards

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Mr Diverall Mouchel & Partners: Mr Pedgrift - Mr Lawton CEG B

Mr Powell

Mr Weaving Mr Macdonald

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Mr Steel

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Lord Kindersley - Lazards Mr Gemmill

Mr Egan -

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Mr Moulson

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Mr Lippitt said that the purpose of the meeting was to bring all parties up to date with recent developments and to agree tactics for the forthcoming meetings in Hong Kong.

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Mr Lippitt proposed that the prime objective in Hong Kong should be to seek a commitment in the form of a Letter of Intent for the power station package. A commitment would also be sought for the gas turbines and the Balfour Beatty transmission contract if this were practicable. He thought it would be necessary to avoid as far as possible being drawn into discussions about detail.

3 Mr Lippitt said that he expected the negotiations in Hong Kong to be much more than just a formality. The contents of Electrowatt's report had not been disclosed to HMG, neither had it yet been possible to come to an agreement about the Hong Kong dollar arrangements. In his view these uncertainties made it imperative for the UK negotiating team to sustain its efforts in Hong Kong.

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In discussion the following points were made:

Power station package: It was agreed that the UK negotiating team would seek, as a minimum, a Letter

of Intent for the power station package. GEC said that they believed that CLP/PEPCO had now been furnished with sufficient additional information on which to base a contract. They confirmed that during discussions with CLP/PEPCO there had been no mention of the option for units 3 and 4,

The CEGB stated that technical assessment of the CEC offer had not yet been completed, they awaited further information from GEC on a number of important questions. Following the final assessment they would however expect to be able to report to CLP/PEPCO that the package was satisfactory.