***********************************************

The Executive Council endorsed today (July 9) a draft Project Agreement on the Penny's Bay Rail Link (PBRL).

The draft Project Agreement sets out how the PBRL project will be undertaken, and the respective obligations of the Government and the MTRCL in terms of the financing, design, construction and operation of the PBRL.

The PBRL is a principal gateway to Hong Kong Disneyland. It has a route length of approximately 3.5 kilometres, running from a new station at Yam O on the existing MTR Tung Chung Line, to Hong Kong Disneyland. The journey will take less than four minutes.

Announcing the decision of the Executive Council, a Government spokesman said that the endorsement of the draft Project Agreement signaled another key step forward in the implementation of the Hong Kong Disneyland Project.

"Construction of the PBRL can start immediately after the Project Agreement is signed. MTRCL is required under the terms of the Project Agreement to complete the PBRL in 2005 such that the commissioning of the PBRL will tie in with the opening of Hong Kong Disneyland."

The project is estimated to cost $2 billion in money of the day prices. In order to ensure the project can achieve an acceptable commercial rate of return, the Government has agreed, as a measure of financial support, to waive its claim for $798 million (at present value) of dividends that would otherwise be payable by MTRCL to Government in the next few years.

"The PBRL is more than just another rail. It will be uniquely designed to be commensurate with the standards of Hong Kong Disneyland. The rail station at Penny's Bay will be themed to match the design of the adjacent Disney Theme Park" the spokesman said.

End/Tuesday, July 9, 2002

NNNN