PJYAHW (2 )
BACKGROUND NOTE
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Daya Bay Nuclear Power Station
1.
In April, during a visit to Peking by Mr Morrison (Minister of
State for Energy) the Chinese raised on a number of occasions
certain problems which have arisen in the performance of GEC
contracts at Daya Bay (the first nuclear power station in China to
be built by a Sino/foreign joint venture company). The main areas
of concern are:-
i)
ii)
the unsatisfactory quality of equipment and drawings for the
plant provided by GEC.
delays in the provision of essential items. As a result, work
on major parts of the project is well behind schedule and costs
are rising.
2.
The Chinese Government have asked HMG to exert influence on GEC
to put matters back on a smooth course. By contrast, French
contractors also working on the project are well on schedule. There
have also been a number of high level visits from the French
Government to the site.
3. Since April the Guangdong Nuclear Power Joint Venture Company
have written to Lord Young, asking for HMG's assistance. Their
letter also refers to the fact that Mr Leon Brittan (then Secretary
of State for Trade and Industry) made a commitment in 1986 that HMG
would make appropriate arrangements to monitor GEC's implementation
of the contract.
4. GEC's erratic performance could, if it continues, have implications for British prospects for securing contracts for further power stations in China. Lord Young has spoken and written to Trafalgar House about the problems, and sought their reassurance that increased efforts will be made to meet targets.
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