Taipower opens tender for 1.4 MT of bituminous coal

COAL SUPPLY BID INVITATION LETTER
Date: March 28, 2006
Subject: Coal Supply Bid Invitation
INVITATION TO BID NO. TPC9503

Taiwan Power Company ("Taipower") is inviting bids for the supply of coal from countries and districts abroad on the following terms and conditions:

The minimum acceptable quality specifications (based on ISO standards) shall be as follows:
- Gross Calorific Value (kcal/kg, as received): 5,500 min.*(1)
- Total Moisture (%, as received): 15 max.*(2)
- Ash Content (%, air dried): 15 max.
- Total Sulfur Content (%, air dried): 1.1 max.
- Volatile Matter (%, air dried): 28 min.
- Fixed Carbon (%, air dried): 60 max.
- Grindability (Hardgrove Index Value): 45 or 42 min.(3)
- Ash Fusion Temperature (C, under reducing condition, H=W): 1,150 min.
- Size: 50 x 0 mm
- Size above 50 mm (%): 5 max.
- Fines under 2 mm (%): 30 max.
- Na2O in Ash (%): 2.0 max.*(4)

*(1) Gross Calorific Value greater than 6,900 Kcal/Kg will be treated as 6,900 Kcal/Kg.
*(2) Total Moisture can be raised to 22% max., if Ash Content is less than 10%.
*(3) Please refer to section 3.2 of the Instructions for Bidding.
*(4) If both actual (a) CaO+MgO>Fe2O3, and actual (b) CaO+MgO+Fe2O3>20% are met, then Na2O in Ash can be raised to 5.0% max.

The quantity of coal to be purchased is 1,400,000 Metric Tons, which shall be shipped by twenty (20) Panamax Size vessels. Each Panamax Size vessel shall load 70,000 Metric Tons of coal plus or minus ten percent (10%) at shipmaster's option and subject to 13.5 meters draft limitation and LOA 240 meters max in Taichung Port. In addition, if the quantity of Coal shown in the Bill of Lading (B/L) is greater than 77,000 Metric Tons, it will be treated as 77,000 Metric Tons. However, if requested by Taipower that the quantity of Coal shown in the Bill of Lading (B/L) is greater than 77,000 Metric Tons, then the price to be paid by Taipower will base on the B/L quantity.

All bids and bid bonds must be received by the Taipower?s Department of Fuels by 16:30, April 11, 2006 (Taipei time) (the "Bid Due Date"). Late bids or bid bonds will be unacceptable and will be returned unopened.

TECHNICAL AND COMMERCIAL PROPOSALS will be publicly opened by Taipower at the offices of Taipower at 09:30, April 12, 2006 (Taipei time), unless a change to such expected time is posted in public. In addition, said opening day will be postponed to the next day if said opening date is not a working day. Bids must be firm and must remain available for acceptance by Taipower until June 11, 2006 (Taipei time).

If you have any questions concerning this Bid Invitation Letter, CONTRACT AGREEMENT form or the bidding documents, please address your questions in writing to Department of Fuels, Taiwan Power Company, 9th Floor, 242 Roosevelt Road, Section 3, Taipei 100, Taiwan, R.O.C. (Telex: 27254 TPCFUEL; Telefax: 886-2-23670597/886-2-23678593) no later than April 3, 2006. Taipower will provide a written reply no later than April 7, 2006, and may publish such reply if necessary.

Stanley C. M. Tsai
Deputy Director for
Director of Department of Fuels
Taiwan Power Company

Editor's Note: Bidding documents can be obtained at Taipower?s web-site address: http://203.69.131.3/material/009bituminouscoal.doc