TNAG-0768-FCO40-972-Supplies-of-electrical-power-for-Hong-Kong-Castle-Peak-power-1978 — Page 161

ĐÓ BTC HONG KONG

GR 400

HKK 164/4

RECEIVED IN G

· 9 AUG 1978

DESA DANCO.A INDEX

See 200

40. 51

#CRY

PA

Acción Taken

Non Chr

TREDGI

нка SD

1205

+2

DESKBY 090100Z

CYPHER CAT A

FM DOT 08191OZ

CONFIDENTIAL

DESKBY 090100Z

·

TO IMMEDIATE BTC HONG KONG TELNO INDUS 161 OF 8 AUGUST

FOR MARCH FROM CAMERON

UNITS 3 AND 4:

A MEETING CHAIRED BY MR LIPPITT WITH ECGD, LAZARDS AND GEC TOOK PLACE TODAY TO DISCUSS OUR STRATEGY ON UNITS 3 AND 4 AS OUTLINED IN THORNTON'S INDUS 144. ECGD AGREED THAT A LETTER OF INTENT WOULD BE SUFFICIENT FOR THE OFFER OF BUYER CREDIT TO BE EXTENDED TO 31 MAY 1979 IN LINE WITH SIR LAWRENCE KADOORIE'S LETTER OF 12 JULY.

THE EXPIRY OF THE COST ESCALATION SCHEME ON 26 MARCH 1979 IS PRIMA FACIE A PROBLEM BUT THERE IS A REASONABLE CHANCE OF AGREEMENT TO EXTEND THE SCHEME FOR A FURTHER YEAR BEING ACHIEVED IN THE NEXT MONTH OR SO. IN ANY CASE PRECEDENT MAY ALLOW US TO EXTEND THE OFFER AS REQUIRED. IN THE LIGHT OF THIS MR LIPPITT WILL BE SENDING SIR LAWRENCE KADOORIE A REASONABLY OPTIMISTIC HOLDING REPLY TO HIS LETTER.

AT THE MEETING MR LIPPITT REFERRED TO SIR LAWRENCE KADOORIE'S OPINION, AS EXPRESSED AT THEIR MEETING LAST WEEK, THAT A CLP-HKE LINK WOULD MEAN AN END TO NEGOTIATED CONTRACTS FOR UK COMPANIES. HE WOULD LIKE TO HAVE YOUR CONSIDERED VIEW ON THIS BEFORE HE GOES ON HOLIDAY AT THE END OF THIS WEEK, (HE RETURNS 11 SEPTEMBER).