Investment in Tuoketuo Power

Beijing Datang Power Generation Com
5 February 2002


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of this announcement, makes no representation as to its accuracy or completeness
and expressly disclaims any liability whatsoever for any loss howsoever arising
from or in reliance upon the whole or any part of the contents of this
announcement.



BEIJING DATANG POWER GENERATION COMPANY LIMITED

(A sino-foreign joint stock limited company incorporated in the People's
Republic of China) 

CONNECTED TRANSACTION

According to Resolutions regarding the Investment and Expansion of Construction
of Tuoketuo Power Plant Phase II passed at the 14th Shareholders' General
Meeting of Inner Mongolia Datang Tuoketuo Power Generation Co., Ltd. ('Tuoketuo
Power Generation Co.') (the 'Resolutions of the 14th Shareholders' General
Meeting of Tuoketuo Power Generation Co.'), Tuoketuo Power Generation Co. shall
continue to undertake construction of the Inner Mongolia Tuoketuo Power Plant
(the 'Tuoketuo Plant') Phase II; it shall increase its total investment and
registered capital; and Beijing Datang Power Generation Company Limited (the
'Company'), Beijing International Power Development and Investment Company
('BIC') and Inner Mongolia Mengdian Huaneng Power Generation Company Limited
('Meng Hua') shall (a) contribute in cash to the increased registered capital of
Tuoketuo Power Generation Co., and (b) provide guarantees for the financing
arrangements made by Tuoketuo Power Generation Co., both according to their
investment interests of 60%, 25% and 15% respectively in Tuoketuo Power
Generation Co.

The guarantees to be provided by the Company constitute a connected transaction
for the Company in the form of financial assistance under Rule 14.25(2)(b) of
the Listing Rules and the Company is required to disclose such transaction in
this announcement and its next published annual report and accounts.

Introduction

Tuoketuo Power Generation Co. was established on 17 November 1995 in Huhehaote
of the Inner Mongolia Autonomous Region. Its principal business is power
generation. The present investors of Tuoketuo Power Generation Co. are the
Company, BIC and Meng Hua, and their investment interests in Tuoketuo Power
Generation Co. are 60%, 25% and 15% respectively.

On 15 January 2002, Tuoketuo Power Generation Co. held its 14th Shareholders'
General Meeting and passed the Resolutions of the 14th Shareholders' General
Meeting of Tuoketuo Power Generation Co. It was resolved that Tuoketuo Power
Generation Co. shall continue to undertake construction of the Tuoketuo Plant
Phase II; it shall increase its total investment and registered capital; and the
Company, BIC and Meng Hua shall increase their investments in Tuoketuo Power
Generation Co. according to their investment interests of 60%, 25% and 15%
respectively in Tuoketuo Power Generation Co., for the construction of Tuoketuo
Plant Phase II.
                                                                         
Increase in Investment

The Phase I project undertaken by Tuoketuo Power Generation Co. (two 600MW coal-
fuelled power generation units) is under construction. The project of Tuoketuo
Plant Phase II will be the construction of two other 600MW coal-fuelled power
generation units and the project proposal of this phase has been approved by the
State Development Planning Commission. Construction will commence in 2002 and
the two coal-fuelled power generation units under the Phase II project are
expected to be completed in 2004 and 2005 respectively.

Pursuant to the Resolutions of the 14th Shareholders' General Meeting of
Tuoketuo Power Generation Co., the total investment of Tuoketuo Power Generation
Co. shall increase by approximately RMB4 billion and its registered capital
shall increase by approximately RMB0.8 billion (the increase amounts of both the
total investment and the registered capital being subject to the final amounts
as approved by the State) in order to undertake the construction of Tuoketuo
Plant Phase II. The total investment and the registered capital of Tuoketuo
Power Generation Co. for the construction of Tuoketuo Plant Phases I and II will
increase to approximately RMB10 billion and RMB2 billion respectively (both the
total investment and the registered capital being subject to the final amounts
as approved by the State).

The contributions to the increased registered capital of Tuoketuo Power
Generation Co. will be made in cash by the Company, BIC and Meng Hua according
to their investment interests of 60%, 25% and 15% respectively in Tuoketuo Power
Generation Co. and at the same terms. The contributions shall be made in phases
as the amounts and timing of such contributions shall be based on the progress
of the construction work.

Accordingly, the Company shall contribute approximately RMB0.48 billion to the
registered capital of Tuoketuo Power Generation Co. Such amount will be funded
by the Company's own internal financial resources.

According to the Resolutions of the 14th Shareholders' General Meeting of
Tuoketuo Power Generation Co., the funding requirement for the construction of
Tuoketuo Plant Phase II in excess of contributions to the registered capital
shall be satisfied by financing. The three investors will provide guarantees for
such financing arrangements according to the ratio of their investment
interests.

The Company will, therefore, provide several (but not joint and several)
guarantees of 60% of the financing arrangements made by Tuoketuo Power
Generation Co. for the construction of Tuoketuo Plant Phases I and II upon
normal commercial terms if so required. The maximum amount of such guarantees
will be RMB4.8 billion for the two phases.

As BIC's shareholding in the Company amounts to approximately 13.01 % of the
registered capital of the Company, BIC is a substantial shareholder of the
Company pursuant to the Listing Rules. The above guarantees to be provided by
the Company constitute a connected transaction for the Company in the form of
financial assistance under Rule 14.25(2)(b) of the Listing Rules and the Company
is required to disclose such transaction in this announcement and its next
published annual report and accounts.

Reasons for the Increase In Investment

The principal business of the Company is to develop, construct, own and operate
power plants. The Board of Directors believes that the increase of investment
mentioned above will expand the production capacity of the Company, broaden the
asset base, optimise the integral cost for power generation in the north east
region, strengthen the Company's regional competitive edge, enlarge its market
share and increase the return for shareholders. The Board of Directors believes
that the terms of the above transaction are fair and reasonable.
                                                                         
Tuoketuo Power Generation Co. is close by the Zhungeer coal mine (about 38
kilometres away). The coals required may be transported directly by exclusive
railway. Therefore, the fuel cost is low.

Upon the completion of Tuoketuo Plant Phase II when the two 600 MW power
generation units commence operation, the electric power so generated will be
transmitted to regions of Beijing, Tianjin and Tangshan, in order to satisfy
part of the power demand in such regions, and at the same time, to achieve
economies of scale of the Company.



By order of the Board
Beijing Datang Power Generation Company Limited 
Yang Hongming
Company Secretary

Beijing, 1 February 2002



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