EXHIBIT 10.85
SUPPLEMENTAL AGREEMENT
FOR
GENERAL INTERCONNECTION AGREEMENT
AND ELECTRIC ENERGY PURCHASE AND SALES AGREEMENT
The Parties to this Supplemental Agreement for General
Interconnection Agreement and Electric Energy Purchase and Sales
Agreement (this "Agreement"), dated February 10, 1996.
North China Power Group Company (hereinafter referred to as
"Party A") and Tangshan Panda Heat and Power Co., Ltd., ("Panda")
and Tangshan Pan-Western Heat and Power Co., Ltd., ("Pan-
Western") (collectively referred to as "Party B"). Panda has
been appointed agent of Pan-Western to act on behalf of Pan-
Western for all matters under this Agreement. Party A and Party
B are collectively referred to as the "Parties".
On September 22, 1995, Party A and Party B signed the
General Interconnection Agreement (the "General Interconnection
Agreement") regarding the interconnection between Panda's power
plant (50 MW) and Pan-Western's power plant (50 MW) (collectively
referred to as the "Power Plants") and the Beijing-Tianjin-
Tangshan Grid of Party A. On September 22, 1995, the Parties
also signed the Electric Energy Purchase and Sales Agreement (the
"Purchase Agreement") relating to the sale of power from the
Power Plants to Party A.
This Agreement supplements the General Interconnection
Agreement and Purchase Agreement for the purpose of clarifying
certain issues in connection with the international financing of
the Power Plants.
The Parties agree as follows:
Article One
DEFINITIONS
1.1 "Facilities" shall mean the 100 kV transmission facilities
required to interconnect the Power Plants with the Grid as well
as the 100 kV transmission and sub-station facilities necessary
for transmitting electric energy to the users.
1.2 "Interconnection Date" shall mean the date specified by
Party B in written notice to Party A for interconnection, which
date shall not be earlier than the time Party A is required to
have completed the Facilities in accordance with the Construction
Agreement and by which the Facilities meet the conditions for
transmitting electric energy from Party B's Power Plants.
1.3 "Test Period" shall mean the period of time between the
interconnection Date and the Commercial Operation Date in which
start-up and testing of the Power Plants electrical generation
capability may occur.
1.4 "Construction Agreement" shall mean the Construction
Agreement between Party A or its authorized representative and
Party B for the construction of the Facilities.
1.5 "Unless defined herein, all terms in this Agreement shall
have the same meanings as the ones in the General Interconnection
Agreement or the Purchase Agreement.
Article Two
INTERCONNECTION; TRANSMISSION SERVICE
2.1 The Parties agree to interconnect Party B's Power Plants
with Party A's electrical systems at the Interconnection Point.
2.2 Commencing on the interconnection Date and continuing for
the term of this Agreement, Party A's Facilities will transmit
Electric Energy Delivered by Party B's Power Plants to the Grid
in accordance with the Purchase Agreement provided that, before
the Commercial Operation Date, Party A will not require the
electric energy transmitted by Party b for test-operation to meet
the Purchase Agreement requirement, and the Facilities shall have
the capability for transmitting Electric Energy Delivered by
Party B's Power Plants at their full load generation. If the
said interconnection Facilities interrupt the transmission of
electric energy by Party B's Power Plants which is due to causes
other than Party B's responsibility or Force Majeure, Party A
shall pay damages to Party B for its direct losses thus incurred.
Article Three
OPERATION OF THE POWER PLANTS
3.1 Prior to the Commercial Operation Date, the following
provisions shall apply:
(a) During the Test Period of Party B's Power Plants, Party
A's Grid agrees to provide service to Party B's Power Plants for
the test-run of its generating unit. The said service shall
include emergency back-up capacity to Party B's Power Plants,
technical consultations, etc.
In the spirit of amicable co-operation, Party A agrees that
no fee will be charged to Party B for the above service. During
this period, Party A shall not check on or penalize Party B for
the generation performance of Party B. Concurrently, Party B's
Power Plants will not charge Party A for Electric Energy
Delivered to the Grid during this period.
(b) Party B shall give Party A ten (10) days prior written
notice of its initial 72 hour test run of each Power Plant to
establish its Commercial Operation Date. To establish the
Commercial Operation Date, such plant must generate electric
power at full load for a continuous 72 hour period. If Party B
does not complete such test successfully, it shall conduct
additional test runs of the Power Plant, which failed the test
run, on at least 24 hours prior written notice to Party A. Party
A may have a representative present for any such test or retest.
Party A and Party B shall sign a certificate establishing the
Commercial Operation Date on the day that the relevant test or
additional test of a Power Plant is completed successfully.
3.2 After the Commercial Operation Date, Party B's Power Plants
shall be normally dispatched by party A so as to allow the Power
Plants to operate in accordance with the General Interconnection
Agreement, the Purchase Agreement, and the Interconnection
Dispatch Agreement which is to be signed soon. Concurrently,
Party A shall agree to Party B's following requests:
(a) The dispatch load curve shall provide for Non-Peak
Hours of operation (between Peak Hours and Trough Hour periods)
permitting Party B's Power Plants to have a ramp period such that
the maximum capacity of such Power Plants may be generated during
all Peak Hour periods.
(b) Party A shall arrange frequency and voltage adjustments,
but Party A may not dispatch a Power Plant's reactive power
beyond the capabilities of the Power Plant's equipment. The ramp
rates of the dispatched load curves of each Power Plant shall not
exceed the requirement of NCPG's Grid for generation units of the
same type.
Article Four
MAINTENANCE OF POWER PLANTS
4.1 Each year (with the exception of the first year), Party A
shall schedule Party B's annual planned overhaul outages based on
Party B's application. The timing for such schedule shall be
fixed by Party A in accordance with the unified arrangement of
the Grid. The period for calculation of outages under Article
Three of the Purchase Agreement shall be based on a November 1 to
October 31 annual period.
4.2 Article Three of the Purchase Agreement shall apply to any
outage and calculations of outage days shall be made on a
cumulative basis.
Article Five
LEGAL EFFECTIVENESS
This Agreement shall have the same legal effectiveness as
the General Interconnection Agreement and the Electric Energy
Purchase and Sales Agreement, and shall be subject to the
relevant provisions of the General Interconnection Agreement.
Article Six
TERM OF THIS AGREEMENT
This Agreement shall be effective on the date written in the
first paragraph of this Agreement upon being signed and stamped
by both Parties. This Agreement shall continue in effect until
the termination of the General Interconnection Agreement at which
time this Agreement shall also terminate.
Article Seven
DOCUMENTS
There shall be six originals of this Agreement. Party A
shall keep two and Party B shall keep four originals. There
shall be copies of this Agreement submitted to and filed with the
relevant authorities of the Government.
IN WITNESS WHEREOF, the Parties, intending to be legally
bound, have caused this Agreement to be signed by their duly
authorized representatives, as of the day and year above written.
Legal Representative of Party A:
North China Power Group Company
By:
Name: Zhao Xxx Xxx
Title: Vice President
Legal Representative of Party B:
Tangshan Panda Heat and Power Co., Ltd.,
By:
Name: Xxxxx Xxxxxxxx
Title: Authorized Legal Representative
Tangshan Pan-Western Heat and Power Co., Ltd.,
By:
Name: Xxxxx Xxxxxxxx
Title: Authorized Legal Representative
