Core Businesses

Water Resources

Water

Dongshen Water Supply Project

The Dongshen Water Supply Project (the "Water Project") is one of the core businesses of the Group. The Group's effective interest in the Water Project is approximately 95.08%. The Water Project is located near the Dongjiang coastline of the Guangdong Province and is responsible for the supply of natural water to Hong Kong, Shenzhen and Dongguan regions. The Water Project has the comprehensive function of water supply, flood prevention, irrigation and electric power generation. It provides the Group with tremendous and steady cashflow.

Pursuant to the Concession Agreement, the Water Project has been granted the right to operate, maintain, develop and upgrade the project and to supply and sell unprocessed natural water to the users in Hong Kong, Shenzhen and Dongguan. The term of the concession is for 30 years commencing from 18 August 2000.

The Water Project has commenced operations since March 1965 for the purpose of addressing the water supply problems faced by Hong Kong. It is a large scale system that takes water from the intake point and transports it approximately 69 kilometres (or 42.9 miles) to Hong Kong, Shenzhen and Dongguan. In order to improve the quality and reliability of water supply and to provide additional capacity to meet increased demand in the future, the project has undergone a series of renovation work in 2000 (the "Renovation Project"). The Renovation Project upgraded the original water project facilities into a protected water supply system and increased transport capacity for the Water Project. Water supply channels and canals are enclosed and covered in order to protect the water from pollutants carried through natural runoff into the waterway. The Renovation Project was completed in 2003 and the designed annual capacity of water supply of the Water Project is about 2.423 billion tons.

The Water Project is the main source of water supply in Hong Kong.

Other Water Resources Projects

Apart from the Dongshen Water Supply Project, the Group has a number of subsidiaries and associates which are principally engaged in water distribution, sewage treatment operation and waterworks construction in the People’s Republic of China.

The total designed water supply capacity of the water supply plants and the total designed waste water processing capacity of the sewage treatment plants of the Group’s Other Water Resources Projects are 12,412,000 tons per day and 1,739,000 tons per day, respectively.