Experts express concern over gas deal
The government's surprise 20-year energy deal with the mainland may not benefit the public, experts say.
'We don't know anything about the price of gas' in the new contract, said Bill Barron, an environmental economist at the University of Science and Technology.
'It is not clear what the government has agreed to with regards to Chinese gas companies. It was very unprofessional of them. This reminds me of the Disneyland thing, where we didn't discover how bad the deal was until years later.'
Chief Executive Donald Tsang Yam-kuen late last month signed a memorandum of understanding with the central government for state-owned China National Offshore Oil Corporation to supply gas to Hong Kong for 20 years.
The deal in effect put paid to CLP Power's plans for a liquefied natural gas terminal on the Soko Islands, off Lantau, and on Thursday the company announced it was abandoning the HK$10 billion project.
The project, in the planning since 2006, was prompted by concerns that the city's primary source of gas, the Yacheng gas field off Hainan , would run out in 2011.
'With CLP, the government would have at least entered a long-term contract with a fixed, or formula-based, price. It also would have secured a large supply of natural gas to Hong Kong,' Professor Barron said.
Larry Chow Chuen-ho, director of the Energy Studies Centre at Baptist University, agreed.
'It is always better for us to ensure our own supply,' Professor Chow said, adding that the CLP project would have kept the city's gas price and supply under local control.
The government decision took CLP by surprise, given that the company had been 'working closely' with the administration on the project for the past two years.
'The government seemed very supportive ... We had no idea they were going to sign this deal,' said a CLP source, adding that it was very unusual for a local power contract to be struck between governments.
Professor Barron said the decision to put the terminal on the Soko Islands, to the consternation of green groups, was the government's and not CLP's.
A site at Tuen Mun's Black Point Power Station, an area occupied by wealthy property owners, was vetoed for 'safety reasons', he said.
