TNAG-0947-FCO40-1166-Oil-developments-in-and-around-Hong-Kong-1980 — Page 46

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CONFIDENTIAL

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for the power companies. However, over the next year or so, the stock kept for the China Light and Power Company will fall to as low as 23 days pending completion of tankage at the new Tap Shek Kok power station by the end of 1981. To counteract this, action has been initiated (although not yet brought to fruition) to store additional oil temporarily on tankers moored in, or just off, Hong Kong waters. Discussions with the oil companies are also about to commence on the formalisation of their stock holding practices in respect of fuel oil, gas oil and naphtha, in order to assure a strategic stock for Hong Kong.

5.

Both the power companies are diversifying from fuel oil into coal for power generation. It is hoped that by 1985 about 50% of the power generated in Hong Kong will be from coal.

6.

So far, the Iran-Iraq dispute is not seriously affecting our oil supply situation. We have good working relations with the oil companies here and can rely on them to co-operate with us if particular responses become necessary.

7.

Please let me know if you would like any further information on these or any related matters.

Yours sincerely,

Rachel Cartland

(R.M. Cartland) (Mrs)

for Secretary for Economic Services

RMC/il

c.c. Dr D.C. Wilson, Hong Kong

P.A.B. Thomson Esq., BTC, Hong Kong T.E.J. Mound Esq. MBE, Peking CR 14/5211/79

CONFIDENTIAL