OREANDA-NEWS. September 11, 2013. In July 2010, CLP Holdings Limited (“CLP”) made known its intention to acquire from China General Nuclear Power Corporation (“CGNPC”) a 17% equity share in the Yangjiang Nuclear Power Station (6 x 1,080MW) in Guangdong Province (“Yangjiang”).

The proposal was subject to regulatory approval and CLP has regularly updated shareholders, through statements in its Annual and Interim Reports, on progress.

In March 2011, the Mainland authorities carried out a National Comprehensive Nuclear Safety Review following the Fukushima nuclear accident. This review resulted in delays in both the approval of CLP’s proposed investment in Yangjiang, as well as in the construction of Yangjiang itself as it awaited completion of the Safety Review.

In October 2012, the State Council approved the Plans for Nuclear Power Safety and Nuclear Power Development (2011–20), which had further potential design implications for Yangjiang.

As mentioned in CLP’s 2012 Annual Report, CLP has been assessing the overall cost impact of possible design changes at Yangjiang and the technology choice for Units 5 and 6 before proceeding with the regulatory approval process to complete the acquisition of the 17% equity share in Yangjiang.

On 2 September 2013, CGNPC advised CLP that due to continuing delays in regulatory approvals and their own review of their funding needs and capital raising options, CLP would not be able to take up its 17% equity share in Yangjiang for the time being.

As a consequence, discussions on Yangjiang have been discontinued. There is no assurance that discuss ions will recommence or, if they do, that CLP will then be able to reach agreement with CGNPC on the terms of any future investment in Yangjiang in the circumstances that may then prevail, notwithstanding the prior history of our agreements and understandings.

On 15 August 2011, CLP and CGNPC signed a conditional share transfer agreement regarding Yangjiang, which has since lapsed.

A deposit of HKD1,159 million paid by CLP in respect of its anticipated investment in Yangjiang was refunded in January 2012, as recorded in the notes to CLP’s financial statements. Therefore, the cessation of discussions on Yangjiang does not give rise to any financial impact on CLP.