TNAG-1058-FCO40-1308-Guangdong-nuclear-power-station-project-1981 — Page 5

Date February 27, 1981.

37)

The purpose of forming a separate Project Management Company (PMC) as distinct from project management being carried out by a team within the JVNPS, is:

38)

i)

ii)

iii)

to limit the risks and responsibilities of this Project Management Company (PMC) to those normally assumed by an Architect/Engineer or project manager.

to continue the 50/50 relationship between the GPC and CLP which has served us so well in drawing up the Feasibility Report.

to facilitate the provision of staff to operate and manage the joint venture company without CLP incurring any direct responsibility.

It is only because of the insistence of GPC that CLP is investing equity capital in HKNIC in order thus to assure GPC that CLP believes in the joint venture project and will use their best endeavours to see that it is carried out to mutual advantage.

39)

As I have stated several times, the size of this contract is such as to remove it from the commercial field and consequently, it can only be carried out satisfactorily on a Government to Government basis.

40)

is to:

The reason for providing that CLP should control the policy of HKNIC

41)

i)

meet GPC's insistence that CLP head up the HKNIC

ii)

iii)

provide the Government insitutions and international bankers, who will be supplying a large part of the finance required against the basic security of the contract entered into between CLP and the nuclear power station for the purchase of power, with the assurance that this contract will be adhered to and honoured.

assure the Hong Kong Government and CLP that the nuclear power station will be operated safely and satisfactorily thus guaranteeing reliability of supply.

Page 8 Para. 2

―

―

It is not surprising to learn that Dr. Marshall:

'cannot hope to interpret Chinese attitudes properly.'

This is difficult even for 'Old China Hands'.

42)

!

To avoid confusion I have stressed that all our negotiations should take place through one party and have agreed with GPC that CLP must assume that responsibility.

43)

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Page 9 Para. 1 We do not agree with Dr. Marshall that there is still time for the British to keep their options open.

44)

Unless serious intentions are expressed immediately others will step in, thus barring all British participation both in the nuclear island and the conventional island.

45)

My participation in this nuclear power project is not for personal aggrandizement but, as stated previously, in the long term interest of preserving the status quo in Hong Kong insofar as this may be possible, something I have worked for, for many years.

46) I believe that, over the past 40 years, CLP's record in regard to the purchase of British plant, is sufficient to show where our sympathies lie.