TNAG-0950-FCO40-1169-Effect-of-nuclear-exports-to-China-on-Hong-Kong-Guangdong-nu-1980 — Page 216

4. STONES ACCEPTED THAT KEC/CLP HAD TO BE SATISFIED ON PRICE

COMPETITIVENESS BUT FELT THAT PROVIDED THE JOING TEAM WAS

SATISFIED ON TECHNICAL PERFORMANCE THE PRICE COULD BE

NEGOTIATED TAKING INTO ACCOUNT THE GENERAL UK SUPPORT

FOR THE PROJECT. HE SUGGESTED THAT IT MIGHT BE POSSIBLE TO USE SWISS OR AMERICAN CONSULTANTS TO GIVE KEC/CLP AN

INDICATION OF WORLD PRICES FOR ALL PLANT OTHER THAN THE NUCLEAR ISLAND. CHEN GANG AGREED TO THIS METHOD OF

CONTRACT STRATEGY FOR FIXING A GEC PRICE.

5. STONES THEN SUGGESTED THAT KEC MIGHT AVOID TENDERING PROCEDURES FOR THE TURBINE GENERATORS AND AUXILIARY PLANT

SINCE THEY COULD NOT ACCURATELY EVALUATE THE COST OF MANAGEMENT AND OPERATIONAL ASSISTANCE AVAILABLE FROM THE U K. CHEN GANG AGREED.

6. STONES SUMMPED UP BY SUGGESTING THAT IF KEC/CLP WERE BOTH SATISFIED WITH THEIR INTERROGATION OF GEC'S TECHNICAL CAPABILITY

AND MACHINE PERFORMANCE, GEC SHOULD BE ASKED TO PROVIDE A PRICE QUOTATION ON THE BASIS OF WHICH CLP/KEC COULD NEGOTIATE USING A

COMPARISON METHOD WITH THE HELP OF INTERNATIONAL CONSULTANTS.

STONES ASKED WHETHER HE MIGHT ASSUME THAT KEC HAD NO OBJECTION

TO THIS APPROACH. CHEN GANG SAID THERE WAS NO OBJECTION AND THAT

HE SUPPORTED THE IDEA. STONES ENDED BY EXPLAINING THAT HE WOULD

SHORTLY BE GOING TO THE U.K. TO DISCUSS SUPPORT FOR THE PROJECT AND THE RESOURCES AND EXPERTISE WHICH HE BELIEVED WERE REQUIRED. HE DID NOT WISH TO RAISE ANY QUESTION IN THE U.K. WHICH WOULD NOT

BE ACCEPTABLE THE CHEN GANG OR MIGHT CAUSE HIM EMBARRASSMENT. CHEN

GANG THANKED STONES FOR HIS CONSIDERATION AND SAID IT WAS VERY IMPORTANT THAT HE SHOULD GO TO THE U.K. AS SOON AS POSSIBLE FOR SUCH DISCUSSIONS.

7. STONES WILL NOW EMBODY THE ABOVE INFORMAL EXCHANGES IN A PROPOSAL FOR CONTRACT STRATEGY TO BE PRESENTED TO THE COMMITTEE. HE HAS ARRANGED HIS HOLIDAY IN ORDER TO BE AVAILABLE IN HONG KONG DURING LORD CARRINGTON'S BRIEF VISIT AND WOULD LIKE TO HAVE DETAILED DISCUSSIONS WITH THE DEPARTMENT OF INDUSTRY IN LONDON IN THE WEEK BEGINNING OCTOBER 13.

8. F.C.0. PLEASE ADVANCE TO DOI, DOT AND DEPT OF ENERGY.

MARCH

WHITED JNU

HK YGD

FED

TRLED

MR P MOBELLY

MA DONALD

ADDITIONAL DIST:

GUANGDONG NUCLEARL

COPIES TO:

DIENERGY

CONFIDENTIAL

2

DOI

DOT