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New Arrangements for Dongjiang Water Supply

The Environment, Transport and Works Bureau announced today (April 13) that the Administration has concluded negotiation with the Guangdong Provincial Government on the new supply arrangements for Dongjiang water under the existing agreements.

Despite increasing demand for the scarce fresh water resources from cities in Guangdong, the new arrangements will guarantee a fully flexible supply of Dongjiang water up to 2008 based on the actual needs of Hong Kong, even under extreme drought conditions with a return period of one in 100 years.

There will be greater flexibility in the daily supply rate to tie in with seasonal fluctuations in the local yield, which will enable Hong Kong to have better control of the storage level in reservoirs, thereby minimising wastage and saving pumping costs.

The total lump sum payment for 2005 is capped at the 2004 level, i.e. $2,529.7 million. The annual expenditure in the purchase of Dongjiang water for the three years from 2006 to 2008 is $2,494.8 million, thereby accruing a total potential saving in the order of $105 million when compared to the 2004 level. This is against the backdrop of rising water prices in the Mainland and projected inflation in the coming years.

Long-term supply of Dongjiang water to Hong Kong to cope with future development under the existing agreements will be reassured under the new arrangements with the ultimate annual supply quantity of 1,100 million cubic metres to be retained. The target date for achieving this projection will be subject to review.

Guangdong will continue to protect the water environment in the vicinity of Dongjiang and strive to upgrade the Dongjiang water quality with a view to complying with the latest national standard. Hong Kong will benefit from reduced expenses in water treatment due to enhanced quality of DJ water.

End/Thursday, April 13, 2006

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