TNAG-0759-FCO40-963-Manufacture-and-storage-of-explosives-in-Hong-Kong-1978 — Page 3

In the absence of any contractual offer it would appear that the special tender board was correct in awarding no points to either company under this heading. But Honourable Members may wish to note that both the Chief Explosives Officer, Mines, Department and the special board consider that the award of the tender to Du Pont would result in a lower range of product prices, particularly in the light of tender premia, as well as, most likely, in a more reliable product.

Effect of an award to either company

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From approaches made to the Government it is clear that both companies attach great importance to the tender. If it should be awarded to I. C. I. there is little doubt that Du Pont will continue to import and sell watergel explosives on the local market. Indeed, it is known that they have at least one important and large contract for supply regardless of whether or not they are successful in the tender. In these circumstances the new manufacturing plant would have healthy competition. However, an increase in the use of watergel explosives from the plant might be expected to be slower if Du Pont were successful because of I...Ts extensive interests in imported dynamites.

the

companies.

Public Relations

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nee

Following the decision to grant a site on restricted tender, a series of public releases were made, which resulted in some adverse press comments on the proposal but generally in a favourable reaction. It is not expected that there will be an adverse reaction to the award of the tender to either of the companies.

11

Аг

Re

Advice Sought

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Honourable Members will be asked to advise whether the tender for a lease of land on Stone cutters Island for a manufacturing plant for cartridge watergel should be awarded to:

(a) Du Pont (Hong Kong) Limited; or

(b)

Imperial Chemical Industries Limited.

(The Deputy Financial Secretary (Mr H. CHING), the Commissioner of Mines (Mr J. N. HENDERSON), the Deputy Secretary for the Environment (Mr G. BARNES) and the Chief Explosives Officer, Mines Department (Mr G. RANSON) will attend before the Council for the discussion of this item).

11th May 1978

(CR 30/641/51 IV)

COUNCIL CHAMBER

CONFIDENTIAL #B