S. Korea?s KOSEP opens tender for 300,000 tons of coal

INVITATION TO BID
for Steaming Coal Supply

KOSEP is inviting a bid for the supply of coal from qualified suppliers on ITB and invites your company to submit a bid to supply coal for Samcheonpo and Yonghung Power Plants as follows,

1. Tender No. : KOSEP-Coal-2006-SP02
2. Quantity : 300,000MT
- Bidders may offer at least 60,000MT or 120,000MT on both FOBT and CFR price. (Price offered either FOBT or CFR only will be disqualified)
3. Shipping Schedule (Loading port) : July 11, 2006 ~ September 20, 2006
4. Procurement Method : International Bidding
5. Qualification : Coal Procucers, Marketing companies or traders who is qualified to participate in the ITB.
6. Coal Specification : Bituminous coal spec. for KOSEP (Min. 5,350kcal/kg NAR)

7. Payment Terms
a. KOSEP shall determine the payment from either Banker?s Usance Letter of Credit (L/C) or Telegraphic Transfer (T/T) payment basis and notify it to seller.
b. In case L/C is opened, ?Determinaton of Coal Quality? clause shall be inserted to the special conditions of L/C.

8. Terms and conditions for a new Bidder
A. Definition
a. A new Bidder means the bidder who does not have any coal supply record to five generation companies of KOSEP, KOMIPO, KOWEPO, KOSPO and KEWESPO in recent three year, and the Bidder who has unfaithful records to the above five companies.

B. Evaluation
a. Evaluation of the bid shall be performed only on the CFR basis. The supplier, however, should offer price on both FOBT and CFR basis.

C. Coal Sample
a. After receipt of Award Notice from KOSEP, the new Bidders have to send one coal sample (above 2kg) taken by an inspection agency to a power plant designated by KOSEP.

D. Determination of Coal Quality
a. Coal quality analysis at the loading port shall be provisional, and should be done by an independent inspection agency who is approved with a written letter by KOSEP.
b. Coal quality analysis at the unloading port by International Agency (Interttek Caleb Brett-KIMSCO Korea or SGS Korea Co., Ltd.) shall be final.
c. The costs required for the determination of the quantity and quality certification at the loading port and unloading port shall be borne by the Seller.
d. KOSEP has the right to perform additional quality surveillance to the coal mine and the shipping process. In such event, the Seller shall cooperate with such attendance and observation. The costs required to perform additional quality surveillance shall be borne by KOSEP.

E. Bid Bond and Performance Bond
a. A new Bidder has to provide Bid Bond and Performance Bond according to Bidding Instructions? Clause 2 and 5 respectively.

9. Bid closing date : 4 P.M. on Wednesday, June 28, 2006. (Korean Standard Time)

10. Bid forms should be forwarded to

Mr. Yong-Jae Lee
Senior Manager, Fuel Team, Business Management Department
Korea South East Power Co. Ltd
169 Daehwa B/D 4F, Samsung-dong, Gangnam-gu, SEOUL, 135-882, Korea.

Any queries on this Bid are welcomed to contact
S. C. Cho
Fuel Team, KOSEPTel) 82-2-3456-7173, Fax) 82-2-3456-7179
E-mail : deepblue@kosep.co.kr (http://www.kosep.co.kr/eng)

June 16, 2006
Korea South East Power Co. Ltd.