Sino-Foreign Cooperative Joint Venture Contract - Jiaozuo Aluminum Mill and Jiaozuo Power Partners LP


Information contained herein, marked with [***], is being filed pursuant to a 
request for confidential treatment.

                     SINO-FOREIGN COOPERATIVE JOINT VENTURE

                     JIAOZUO WAN FANG POWER COMPANY LIMITED

                                    CONTRACT







                                 March 27, 1996
                               250 MW Power Plant

                          Jiaozuo City, Henan Province

                           People's Republic of China






                          T A B L E  O F  C O N T E N T S


Chapters                                                                Pages

Chapter 1.   Definitions                                                  1

Chapter 2.   Parties to this Contract; Representations and Warranties     4

Chapter 3.   Establishment of the Joint Venture                           5

Chapter 4.   Purpose and Scope of Business                                6

Chapter 5.   Total Amount of Investment and Capital                       6

Chapter 6.   Responsibilities of Each Party                               8

Chapter 7.   Construction of the Power Plant                              10

Chapter 8.   Operation of the Power Plant                                 10

Chapter 9.   Board of Directors                                           11

Chapter 10   Management                                                   12

Chapter 11.  Personnel and Labor Management                               13

Chapter 12.  Trade Union                                                  14

Chapter 13.  Purchase of Equipment                                        14

Chapter 14.  Taxes and Licenses                                           14

Chapter 15.  Accounting; Distribution of Profits; Priority of Payments    15

Chapter 16.  Sale of Electricity                                          17

Chapter 17.  Independent Auditing                                         17

Chapter 18.  Foreign Exchange Management                                  17

Chapter 18.  Foreign Exchange Management                                  17

Chapter 19.  Term                                                         18

Chapter 20.  Insurance                                                    18

Chapter 21.  Land Use                                                     19

Chapter 22.  Applicable Law                                               19


                                      (i)


Chapter 23.  Effects of Changes in Chinese Law                            19

Chapter 24.  Breach of Contract                                           19

Chapter 25.  Termination                                                  20

Chapter 26.  Liquidation                                                  21

Chapter 27.  Force Majeure                                                22

Chapter 28.  Settlement of Disputes                                       23

Chapter 29.  Non-Disclosure of Business Information                       24

Chapter 30   Miscellaneous                                                25

                                      (ii)


                     SINO-FOREIGN COOPERATIVE JOINT VENTURE

                     JIAOZUO WAN FANG POWER COMPANY LIMITED

                                    CONTRACT


                                    PREAMBLE


     This  Cooperative  Joint  Venture  Contract is made this 27th day of March,
 1996 by and between JIAOZUO  ALUMINUM MILL, a Chinese  enterprise (the 'Chinese
 Party'),  and JIAOZUO POWER PARTNERS,  L.P., a Cayman Islands  exempted limited
 partnership (the 'Foreign Party').

     WHEREAS,  in accordance  with the Law of the People's  Republic of China on
 Sino-foreign  Cooperative  Enterprises,  the implementing  rules thereunder and
 other relevant Chinese laws and regulations,  the Chinese Party and the Foreign
 Party,  adhering to the  principle of equality  and mutual  benefit and through
 friendly   consultations,   agree  to  organize  a  cooperative  joint  venture
 enterprise in Jiaozuo City, Henan Province,  the People's Republic of China and
 to invest jointly for the purposes  described  herein,  all upon and subject to
 the terms and conditions set forth herein;

     NOW,  THEREFORE,  the Parties,  intending to be legally bound under Chinese
 law, enter into this Contract under the following terms and conditions:


                                    CHAPTER 1

                                   DEFINITIONS

     When used in this  Contract the following  capitalized  (or, in the Chinese
 version hereof, underlined) terms shall have the meanings set forth below:

     'Aluminum  Mill Power Supply  Contract'  means the Power  Purchase and Sale
 Contract  between the Joint Venture and the Chinese Party, as it may be amended
 or otherwise modified from time to time.

     'Articles of  Association'  means the Articles of  Association of the Joint
 Venture signed by the Parties.

     'Board'  means the Board of  Directors  of the  Joint  Venture  established
 pursuant to Chapter 9.1.

     'Business  License'  means the business  license of the Joint Venture to be
 issued by the Jiaozuo Municipal Administration for Industry and Commerce.

                                       -1-


     'Coal  Purchase and  Transportation  Contract'  means the Coal Purchase and
 Transportation  Contract  entered into by the Joint  Venture for the supply and
 transportation of coal, as it may be amended or otherwise modified from time to
 time.

     'Contract'  means this  Cooperative  Joint Venture  Contract,  as it may be
 amended or otherwise modified from time to time.

     'Deputy  General  Manager'  means the Deputy  General  Manager of the Joint
 Venture appointed pursuant to Chapter 10.2.

     'Dispatch Contract' means the Dispatch and Interconnection Contract between
 the Joint Venture and the Henan Electric Power Corporation.

     'Expatriates' has the meaning set forth in Chapter 11.4.

     'Financing  Documents'  means,  collectively,  all  documents  executed and
 delivered  between  the  Joint  Venture  and any Party in  connection  with the
 financings contemplated in Chapter 5.5.

     'Foreign  Exchange  Rate'  means  the  exchange  rate of U.S.  Dollars  for
 Renminbi actually used by the Joint Venture as permitted by SAEC.

     'Foreign  Exchange Risk Fund' means the foreign exchange risk fund required
 to be funded by the Joint Venture from the Joint Venture's  after-tax  profits,
 as the approved power price has taken into consideration the exchange rate risk
 factor. Such fund shall be used to balance the rates of return to both Parties.

     'Foreign Exchange  Regulations'  means the regulations and rules on foreign
 exchange published by the relevant authorities of China as they may be amended,
 modified, replaced or superseded.

     'General  Manager' means the General Manager of the Joint Venture appointed
 pursuant to Chapter 10.2.

     'Interconnection Construction Contract' means the Engineering,  Procurement
 and  Construction  Contract  between the Joint  Venture and the Henan  Electric
 Power Corporation,  for the construction of the transmission facilities,  as it
 may be amended or otherwise modified form time to time.

     'Interconnection  Financing  Contract' means the financing contract between
 the  Joint  Venture  and the  Henan  Electric  Power  Corporation,  to  provide
 financing from the Joint Venture to the Henan Electric  Power  Corporation  for
 the  construction  of the  transmission  facilities,  as it may be  amended  or
 otherwise modified from time to time.

     'Joint Venture' means the cooperative joint venture company  established by
 the Chinese Party and the Foreign Party pursuant to the terms of this Contract.

                                       -2-


     'Land Use  Rights'  means  the  right to the use of the Site  issued by the
 relevant Chinese government  authority in charge of land management as provided
 in  Chapter 21 and any other land use rights  necessary  or  desirable  for the
 construction and operation of the Power Plant for the Term.

     'Liquidation  Committee'  means  the  Liquidation  Committee  described  in
 Chapter 26.2.

     'MOFTEC'  means the Ministry of Foreign Trade and Economic  Cooperation  of
 China or any successor approval authority.

     'Parties'  means the  Chinese  Party and the Foreign  Party,  collectively.
 'Party' shall mean either of the Parties, individually.

     'Power Company Power Purchase  Contract'  means the Power Purchase and Sale
 Contract between the Joint Venture and the Henan Electric Power Corporation, as
 it may be amended or otherwise modified from time to time.

     'Power  Plant'  means the  coal-fired  electric  generating  facility to be
 located at the Site  consisting  of 2 x 125  megawatt  generating  units with a
 combined  capacity of  approximately  250 megawatts,  as well as generation and
 fuel handling facilities and all other related equipment and facilities.

     'Power Plant Power Purchase  Contract' means the Power Plant Power Purchase
 Contract between the Joint Venture and the Henan Electric Power Corporation for
 the purchase by the Joint Venture of electricity for construction, start-up and
 other uses at the Power Plant, as it may be amended from time to time.

     'Project  Contracts'  means,  collectively,  (i) the  Power  Company  Power
 Purchase  Contract,  (ii) the Aluminum  Mill Power Supply  Contract,  (iii) the
 construction  contracts,  (iv) the Site Use Contract, (v) the Coal Purchase and
 Transportation  Contract,  (vi) the  Dispatch  Contract,  (vii)  the  Financing
 Documents,   (viii)  the  Power  Plant  Power  Purchase   Contract,   (ix)  the
 Interconnection  Financing  Contract and (x) the  Interconnection  Construction
 Contract.

     'Renminbi' or 'RMB' means the lawful currency of China.

     'SAEC' means the State Administration for Exchange Control of China.

     'SAIC' means the State Administration for Industry and Commerce of China.

     'Site' means the land located at Jiaozuo City,  Henan Province,  China upon
 which the Power Plant is to be constructed and located, as more fully described
 on the Site Map.

     'Site Map' means the map on which the  boundaries of the Site are marked in
 red.


                                       -3-


     'Site Use  Contract'  means  the Site Use  Contract  executed  by the Joint
 Venture  relating  to the use by the Joint  Venture  of the Site,  as it may be
 amended or otherwise modified from time to time.

     'State Planning Commission' means the State Planning Commission of China.

     'U.S.  Dollars' or 'US$' means the lawful  currency of the United States of
 America.


                                    CHAPTER 2

            PARTIES TO THIS CONTRACT; REPRESENTATIONS AND WARRANTIES

2.1  The Parties to this Contract are:

         (a)       Jiaozuo  Aluminum  Mill,  a Chinese  enterprise  organized in
                   accordance  with the laws of China  and  registered  with the
                   Jiaozuo  Municipal  Administration  of Industry  and Commerce
                   (Business License number is 410800-17347144-14931).

                   Legal Address:    160 Tanan Road
                                     Jiaozuo City
                                     Henan Province
                                     China

                   Telefax:          (86-391) 393-3739

                   Legal representative: Name: Jin Bao Qing
                                         Position: General Manager
                                         Nationality: Chinese

         (b)       Jiaozuo  Power  Partners,  L.P.,  a Cayman  Islands  exempted
                   limited partnership.

                   Legal Address:    P.O. Box 309
                                     George Town, Grand Cayman
                                     Cayman Islands, British West Indies

                   Telefax:          (852) 2530-1673

                   Legal representative: Name: Paul Hanrahan
                                         Position: President of Jiaozuo (GP)
                                                    Corporation, its
                                                     General Partner
                                         Nationality: U.S.A.


                                       -4-


2.2  Each Party hereby represents and warrants to the other Party that:

     (a)  (i) in the case of the Chinese Party,  it is a state-owned  enterprise
          duly  organized and validly  existing as a legal person under the laws
          of China;  and (ii) in the case of the Foreign  Party,  it is a Cayman
          Islands  exempted  limited  partnership  duly  organized  and  validly
          existing under the laws of the Cayman Islands;

     (b)  it has full legal right and power to execute and deliver this Contract
          and all of the contracts and documents referred to in this Contract to
          which it is a Party  and to  perform  its  obligations  hereunder  and
          thereunder; and

     (c)  it has taken all  appropriate  and  necessary  action to authorize the
          execution and delivery by it of this Contract and all of the contracts
          and documents  referred to in this Contract to which it is a Party and
          to authorize the performance by it of the terms and conditions  hereof
          and thereof.


                                    CHAPTER 3

                       ESTABLISHMENT OF THE JOINT VENTURE

3.1  The Parties will establish the Joint Venture as a Sino-foreign  cooperative
     joint venture company in accordance  with the Law of the People's  Republic
     of China on Sino-foreign  Cooperative  Enterprises,  the implementing rules
     thereunder,  other relevant  Chinese laws and  regulations and the terms of
     this Contract.

3.2  The Joint  Venture  will be a limited  liability  company with legal person
     status.  The liability of each Party to the Joint Venture is limited to its
     capital  contribution.   After  the  Joint  Venture  has  commenced  normal
     operation,  however,  the Foreign Party shall bear unlimited  liability for
     the Joint Venture's indebtedness.

3.3  The name of the Joint  Venture  in  Chinese  is  'Jiaozuo  Wan Fang  Dianli
     Youxian Zeren Gongsi.' The name of the Joint Venture in English is 'Jiaozuo
     Wan Fang Power Company  Limited.' The legal address of the Joint Venture is
     Daiwangzhen, Jiaozuo City, Henan Province, China.

3.4  All  activities  of the Joint Venture will be governed by and will be under
     the protection of the promulgated laws,  decrees,  rules and regulations of
     China.

                                       -5-


                                    CHAPTER 4

                          PURPOSE AND SCOPE OF BUSINESS

4.1  The  purpose  of  the  Joint  Venture  shall  be  to  strengthen   economic
     cooperation   and   technical   exchanges,   to  satisfy  the   electricity
     requirements  of the Chinese Party, to improve power supply and promote the
     development  of the  economy in Henan  Province by  adopting  advanced  and
     appropriate   technology  and  scientific   management   methods,   and  to
     continuously raise the economic  efficiency of the Joint Venture and ensure
     satisfactory economic benefits for each Party.

4.2  The business scope of the Joint Venture shall be to build, own, operate and
     maintain a 2 x 125 MW coal-fired  self-supply  power plant near the site of
     the  Jiaozuo   Aluminum  Mill  of  Henan  Province  to  generate  and  sell
     electricity  according  to the relevant  contracts  and develop and operate
     power related business in utilizing coal ash.

4.3  The  business  activities  of the  Joint  Venture  will be  carried  out in
     accordance   with  the  provisions  of  this  Contract,   the  Articles  of
     Association and the decisions of the Board.


                                    CHAPTER 5

                     TOTAL AMOUNT OF INVESTMENT AND CAPITAL

5.1  The total amount of investment in the Joint Venture will be One Billion Two
     Hundred  Sixty  Million  Seven  Hundred  Ninety   Thousand   Renminbi  (RMB
     1,260,790,000).

5.2  The total  registered  capital of the Joint  Venture  will be Four  Hundred
     Forty  Seven   Million  Five  Hundred   Eighty   Thousand   Renminbi   (RMB
     447,580,000).

5.3  (a)  The Chinese  Party will  contribute to the  registered  capital of the
          Joint Venture One Hundred Thirty Four Million Two Hundred Seventy Four
          Thousand  Renminbi  (RMB  134,274,000),  which  is equal to 30% of the
          total registered capital of the Joint Venture.  The Chinese Party will
          make its  contribution to the registered  capital of the Joint Venture
          in the form of Power Plant  equipment and Land Use Rights (which Power
          Plant equipment and Land Use Rights  contributions  and  corresponding
          values shall be confirmed by the Henan  Provincial  Administration  on
          State Assets and agreed to by the Parties).

     (b)  The Foreign  Party will  contribute to the  registered  capital of the
          Joint  Venture Three  Hundred  Thirteen  Million Three Hundred and Six
          Thousand  Renminbi  (RMB  313,306,000),  which  is equal to 70% of the
          total registered capital of the Joint Venture.  The Foreign Party will
          make its  contribution to the registered  capital of the Joint Venture
          in cash in

                                       -6-


          U.S.  Dollars at the prevailing  Foreign  Exchange Rate at the time of
          contribution.

5.4  The Parties will fund the entire amount of their respective portions of the
     registered  capital of the Joint  Venture 30 days after the issuance of the
     Business  License to the Joint Venture.  Late payment (unless caused by the
     fact that the Joint  Venture  bank  account has not been  timely  opened or
     caused by delays in  receipt of wire  transfer  after  being  sent) will be
     subject to an interest charge of 2% per month (or portion thereof) from the
     date due until the date paid.  In the event  either Party fails to make its
     capital  contribution  within two days of the date due, the other Party may
     (but shall not be obligated to) make such  contribution,  in which case the
     percentage  of the  registered  capital of the  Parties  shall be  adjusted
     accordingly,  subject  to  the  approval  by  the  original  examining  and
     approving  authority.  The  Party  failing  to make such  installment  will
     nevertheless remain liable for accrued interest from the date due until the
     date the other Party makes such contribution.

5.5 (a)  The Chinese  Party will provide a loan in RMB to the Joint  Venture in
          an amount  equivalent to 30% of the  difference  between the amount of
          the total  investment  set forth in Chapter  5.1 and the amount of the
          registered  capital of the Joint Venture set forth in Chapter 5.2 upon
          terms acceptable to the Joint Venture.

     (b)  The  Foreign  Party will  provide a loan in U.S.  Dollars to the Joint
          Venture in an amount  equivalent to 70% of the difference  between the
          amount of the total investment set forth in Chapter 5.1 and the amount
          of the  registered  capital of the Joint  Venture set forth in Chapter
          5.2 upon terms acceptable to the Joint Venture.

     (c)  The Joint  Venture shall have no liability or obligation to any person
          or entity with respect to the shareholder  loans provided  pursuant to
          this  Chapter  5.5 other  than to the  providers  of such  shareholder
          loans.

5.6  The  registered  capital of the Joint  Venture  may be  increased  with the
     written  consent of the Parties,  the consent of the Board and the approval
     of MOFTEC.

5.7  After the Parties have made their entire respective  capital  contributions
     to  the  Joint  Venture,  the  Joint  Venture  will  engage  an  accountant
     registered in China to verify such capital contributions. Upon the issuance
     of a verification  report by such accountant,  the Joint Venture will issue
     an investment certificate to each Party.

5.8  (a)  Neither Party may assign,  sell, encumber or otherwise transfer all or
          any part of its interest in the Joint Venture  without first obtaining
          (i) the consent of the other Party,  which  consent may be withheld in
          the other  Party's sole and absolute  discretion;  (ii) the  unanimous
          approval by the Board of Directors; (iii) the approval by the original
          examining  and  approving  authority;  and (iv) the  agreement  by the
          transferee to assume the transferor's  obligation hereunder,  provided
          that with respect to assignments

                                       -7-


          by  either  Party  to one or more of its  100%  owned  companies,  the
          Parties will cause their  directors to vote for such  assignment.  Any
          instrument purporting to transfer any interest in the Joint Venture in
          violation of these  restrictions  shall be null and void and therefore
          shall  not be  effective  to  confer  any  right  upon  the  purported
          transferee.

     (b)  In addition,  any such proposed  assignment,  sale or transfer will be
          subject to the right of the other Party as  hereinafter  described  to
          acquire the interest proposed to be assigned, sold or transferred.  In
          the event a Party proposes to assign, sell or transfer all or any part
          of its interest in the Joint Venture, the transferring Party will give
          a  written   notice   (the   'Assignment/Transfer   Notice')   to  the
          non-transferring  Party  setting forth the terms and  conditions  upon
          which the  assignment,  sale or transfer  is proposed to be made.  The
          non-transferring  Party will have the right, which shall be exercised,
          if at all, by notice to the  transferring  Party  within 60 days after
          the non-transferring Party receives the Assignment/Transfer Notice, to
          acquire such  interest upon the same terms and  conditions  upon which
          the  assignment,  sale or  transfer  is  proposed  to be made.  If the
          transferring  Party does not receive  such  notice  within such 60-day
          period and if the transferring Party complies with the restrictions in
          Chapter 5.8(a),  the transferring Party will have the right to assign,
          sell or otherwise transfer such interest to the proposed transferee on
          the terms and conditions set forth in the Assignment/Transfer Notice.


                                    CHAPTER 6

                         RESPONSIBILITIES OF EACH PARTY

6.1  The Chinese Party will perform,  in addition to its other  obligations  set
     forth in this Contract, each of the following duties:

     (a)  contributing  its  capital  at the times and in the  amounts  required
          pursuant to Chapter 5;

     (b)  providing financing as described in Chapter 5.5;

     (c)  obtaining  and  delivering  to the Joint Venture no later than 15 days
          after the  approval  by  MOFTEC  of this  Contract  an  original  or a
          notarized  photocopy  of a  document  issued by the  relevant  Chinese
          government authority in charge of land management  evidencing that all
          governmental consents,  approvals and similar items have been obtained
          in  connection  with the  grant to the Joint  Venture  of the Land Use
          Rights  that are  necessary  or  desirable  for the  construction  and
          operation of the Power Plant;

     (d)  assisting  the Joint  Venture in obtaining no later than 15 days after
          the  approval  by MOFTEC of this  Contract  an original or a notarized
          photocopy of all relevant approvals  (including approvals of the Power
          Bureau Power  Purchase  Contract  and the  Aluminum  Mill Power Supply
          Contract and the 

                                       -8-

          specific pricing  provisions  contained therein for the entire term of
          each  such   contract)   that  are  necessary  or  desirable  for  the
          construction  and operation of the Power Plant;

     (e)  arranging  for  the  transfer  of the  relevant  construction  related
          contracts to the degree that the Joint  Venture  requests that they be
          transferred;

     (f)  assisting  the Joint  Venture  in  purchasing  or  leasing in China at
          reasonable  rates  in  Renminbi  such  equipment,   materials,  office
          supplies,  transportation services, communication facilities and other
          goods  and  services  as  may  be  necessary  or  desirable   for  the
          construction and operation of the Power Plant;

     (g)  assisting the Joint Venture in recruiting qualified Chinese management
          personnel,   technical  personnel,  and  workers  as  contemplated  in
          Chapters  10 and 11 and  assisting  the  Joint  Venture  in  obtaining
          passports and all necessary travel documents required for such persons
          to travel  overseas  for  training  or other  purposes  related to the
          construction and operation of the Power Plant;

     (h)  assisting foreign personnel of the Joint Venture in applying for entry
          visas,  travel  documents  and  work  licenses  and in  arranging  for
          suitable  board,  lodging,  office  space,   transportation,   medical
          facilities and security for such personnel;

     (i)  assisting  the  Joint  Venture  in  applying  for tax  reductions  and
          exemptions and any other investment  incentives and benefits available
          to the  Joint  Venture  and the  Foreign  Party in China  and in Henan
          Province;

     (j)  assisting  the Joint  Venture in applying to the Bank of China as well
          as to other  authorized  banks for the opening of foreign currency and
          Renminbi accounts for the Joint Venture; and

     (k)  performing such other  responsibilities as shall be entrusted to it by
          the Joint Venture.

6.2  The Foreign Party will perform,  in addition to its other  obligations  set
     forth in this Contract, each of the following duties:

     (a)  contributing  its  capital  at the times and in the  amounts  required
          pursuant to Chapter 5;

     (b)  providing financing as described in Chapter 5.5;

     (c)  assisting the Joint Venture in obtaining  such  equipment,  materials,
          supplies,  goods  and  services  not  available  in  China  as  may be
          necessary or desirable for the construction and operation of the Power
          Plant;

                                       -9-


     (d)  assisting the Joint Venture in recruiting necessary foreign personnel;
          and

     (e)  performing such other  responsibilities as shall be entrusted to it by
          the Joint Venture.


                                    CHAPTER 7

                         CONSTRUCTION OF THE POWER PLANT

7.1  The Joint Venture will be  responsible  for the  construction  of the Power
     Plant.  The Joint Venture will work with one or more  contractors to assist
     it in constructing the Power Plant.

7.2  The  Chinese   Party  and  the  Foreign   Party  will  work  together  with
     construction  contractors  to  transfer  any ongoing  design,  engineering,
     equipment procurement and construction work with respect to the Power Plant
     from  the  Chinese  Party  to the  Joint  Venture  in  accordance  with the
     construction contracts.

7.3  Since the Power Plant is under  construction,  at the time the Parties make
     contributions to the registered  capital of the Joint Venture,  the Chinese
     Party  shall,  pursuant  to an  agreement  to be entered  into  between the
     Parties,  transfer to the Joint Venture the equipment,  materials, Land Use
     Rights,  completed  and  ongoing  construction  work  of the  Power  Plant,
     relevant construction contracts and other assets contributed by the Chinese
     Party  prior  to  the   establishment   of  the  Joint  Venture.   Detailed
     arrangements for such transfer shall be specified in the relevant agreement
     to be entered into between the Parties.  Both Parties agree to consider the
     time factor  regarding  assets that have been valued and  confirmed  by the
     Henan Provincial Administration on State Assets.

7.4  During the  construction  period the Joint Venture may enter into contracts
     with one or more consulting  companies or engineering  companies to provide
     consulting services.


                                    CHAPTER 8

                          OPERATION OF THE POWER PLANT

8.1  The Joint Venture will be responsible  for the operation and maintenance of
     the Power Plant.

8.2  Upon the  agreement  of both  Parties,  the Joint  Venture  may enter  into
     contracts  with one or more companies to provide  consulting  services with
     respect to the operations of the Power Plant.

                                       -10-


                                    CHAPTER 9

                               BOARD OF DIRECTORS

9.1  The Joint  Venture will  establish a Board of  Directors  which will be the
     highest  authority  of the Joint  Venture.  The Board will decide all major
     issues concerning the Joint Venture.

9.2  The Board will be composed of six directors,  of whom two will be appointed
     by the Chinese Party and four will be appointed by the Foreign  Party.  The
     Board of Directors shall be established on the day the Business  License is
     issued to the Joint Venture. Each of the directors will serve for a term of
     three years and may serve for  consecutive  terms upon  appointment  by the
     original Party.  The Chairman of the Board will be appointed by the Foreign
     Party and the  Vice-Chairman  of the Board will be appointed by the Chinese
     Party.  If a seat on the  Board  is  vacated  by a  director  prior  to the
     completion of such director's  term, the Party which  originally  appointed
     such director  will, as soon as possible,  appoint a successor  director to
     serve out such vacating  director's term. The quorum for a Board meeting is
     five directors, and the detailed procedures for holding a Board meeting are
     specified in the relevant provisions of the Articles of Association.

9.3  Except for the matters listed from (a) to (i) below, all matters considered
     by the Board will be subject to the  approval  of a majority  of the entire
     Board; however, prior to taking an action which any Party reasonably thinks
     might  substantially  affect such Party's reasonable  interests,  the Board
     shall fully  explore other options and attempt to implement the option that
     will have the least  adverse  impact on the  reasonable  interests  of such
     Party;  provided,  however, that such option will not materially affect the
     profitability  or safe and  reliable  operation  of the  Power  Plant.  The
     unanimous  approval of the Board will be required to  authorize  any of the
     following actions:

     (a)  amendment to the Articles of Association of the Joint Venture;

     (b)  termination and dissolution of the Joint Venture;

     (c)  increase or decrease or  assignment of the  registered  capital of the
          Joint Venture;

     (d)  merger,  split  or  change  of the  organizational  form of the  Joint
          Venture;

     (e)  mortgaging or granting a security  interest on the assets of the Joint
          Venture;

     (f)  approval of the year end financial statements of the Joint Venture;

     (g)  approval of all contracts  between the Joint Venture and a Party or an
          affiliate company of a Party;

                                      -11-


     (h)  profit distribution plan of the Joint Venture; and

     (i)  appointment of the General Manager of the Joint Venture.

9.4  The  Chairman  of the Board will be the legal  representative  of the Joint
     Venture.  The Chairman  will have the power to preside over the meetings of
     the Board and exercise the other functions of the Chairman set forth in the
     Articles of  Association.  Whenever the Chairman cannot exercise his or her
     functions for any reason,  the Vice Chairman  shall exercise such functions
     as the representative of the Chairman until the Chairman resumes his or her
     functions  or a successor is  appointed.  Neither the Chairman of the Board
     nor the Vice  Chairman of the Board shall have the power to take any action
     binding the Board or the Joint Venture without the express authorization of
     the Board.

9.5  The  functions,  powers and  working  procedures  of the Board shall be set
     forth in the Articles of Association.

9.6  Directors shall serve without compensation except when a director is also a
     member of management or an employee of the Joint  Venture.  All  reasonable
     traveling and hotel costs for each director  incurred in direct  connection
     with board meetings or Joint Venture  business  approved by the Board shall
     be borne by the Joint Venture in the currency incurred.


                                   CHAPTER 10

                                   MANAGEMENT

10.1 The Joint  Venture will be managed using modern and  scientific  management
     techniques.

10.2 The Joint Venture will have a General Manager and a Deputy General Manager.
     The General  Manager will be  recommended  by the Foreign Party and will be
     appointed by unanimous  decision of the Board.  The Deputy General  Manager
     will be  recommended by the Chinese Party and will be appointed by majority
     decision of the Board.  The term of office of the  General  Manager and the
     Deputy General Manager will be three years from the date of appointment.

10.3 The General Manager will be responsible for  implementing  the decisions of
     the Board and organizing  and conducting the daily  management of the Joint
     Venture,  and will have the  authority to  accomplish  the  foregoing.  The
     Deputy General Manager will assist the General Manager.

10.4 The  details of the  appointment  of the other  senior  employees  shall be
     specified in the Articles of Association.

                                      -12-


                                   CHAPTER 11

                         PERSONNEL AND LABOR MANAGEMENT

11.1 The initial labor plan,  consisting of the number of employees of the Joint
     Venture,  including  levels and job  descriptions,  will be prepared by the
     General  Manager and then  submitted to the Board for  approval.  The labor
     plan will be revised at least  annually  by the  General  Manager  and then
     submitted  to the Board for  approval.  The Joint  Venture will employ only
     such number of employees as is necessary for its  operations.  Increases or
     decreases  in the total  number of  employees  of the Joint  Venture due to
     expansion or increased efficiency,  respectively, will require the approval
     of the Board.

11.2 Labor and personnel policies of the Joint Venture will be determined by the
     General Manager,  subject to approval by the Board.  These policies will be
     consistent  with the  promulgated  laws,  rules  and  regulations  of China
     available to the public and will be based on the following principles:

     (a)  The  General  Manager  will  implement  hiring  policies  whereby  all
          employees  of the  Joint  Venture  will be  selected  on the  basis of
          examination  and will have the best possible  qualifications.  In this
          regard,  the Joint  Venture will be free to hire  qualified  personnel
          from any location in China and, if necessary,  from foreign countries.
          All  employees  will first be employed  on a  probationary  basis.  In
          accordance  with the labor policies of the Joint Venture,  the General
          Manager  shall  (within  the  authority  granted  by the Board and the
          Articles  of  Association)  have  the  authority  to  select  and hire
          employees for any position and to dismiss such employees.  The General
          Manager may delegate such authority as he or she deems appropriate.

     (b)  The  salaries  and all  welfare  benefits  and  subsidies  for Chinese
          employees  of the Joint  Venture  will be set forth in the labor plan.
          Annual wage levels of all Chinese employees (including, if applicable,
          the General Manager) will be set annually by the Board and adjusted as
          the Board deems  necessary  (taking  into  consideration  the economic
          conditions  of the Joint  Venture) in  accordance  with Chinese  labor
          regulations  concerning  wages.  Welfare  benefits  and  subsidies  to
          Chinese  workers  and  staff  will be  given  as  provided  by law and
          reviewed  and  approved  annually by the Board.  Further  benefits and
          subsidies  may be  determined  by the  Board,  but will not exceed the
          standards  set by the  relevant  governmental  authority.  The General
          Manager may, in accordance with the policies  established by the Board
          and the budget of the Joint  Venture then in effect,  award bonuses to
          employees and managers. All bonuses of whatever type for employees and
          managers will be established  as an incentive,  and will be awarded on
          the basis of performance.

     (c)  The General  Manager  will  recommend to the Board annual merit salary
          increases for specific employees. Such increases will be based upon

                                      -13-


          the individual  employee's  performance and will be in accordance with
          Chinese labor regulations concerning wages.

     (d)  The wages and welfare benefits for the Joint Venture's employees shall
          be higher than the average level of the wages and welfare benefits for
          the employees in the same industry in Henan Province.

11.3 The Joint Venture may enter into individual  employment  contracts with any
     Chinese staff and workers directly if it deems such contracts  appropriate.
     If  required  by law,  the Joint  Venture  will  enter  into an  employment
     contract with the trade union on behalf of Chinese staff and workers.

11.4 Foreign high-ranking managers and other staff ('Expatriates') will serve as
     executives and in other  positions of the Joint Venture and will enter into
     an employment contract with the Joint Venture.


                                   CHAPTER 12

                                   TRADE UNION

     The employees of the Joint Venture may establish a trade union  pursuant to
 relevant Chinese laws and regulations.  The Joint Venture shall pay two percent
 (2%) of the actual wages  received by  employees of the Joint  Venture into the
 Joint  Venture's trade union fund for such trade union's use in accordance with
 the applicable laws of China on the management of trade union funds.


                                   CHAPTER 13

                             PURCHASES OF EQUIPMENT

     Except as otherwise  provided in the Project  Contracts,  the Joint Venture
 will endeavor to source equipment,  materials,  fuel, parts, services and other
 required items in China.


                                   CHAPTER 14

                               TAXES AND LICENSES

14.1 The Joint Venture will pay taxes in  accordance  with the tax laws of China
     and the relevant provisions of the taxation department of Henan Province.

14.2 Management,  staff  members  and  workers  of the  Joint  Venture  will pay
     individual  income tax according to the Individual Income Tax Law of China.
     The Joint Venture will not be responsible for paying any such taxes.

                                      -14-


                                   CHAPTER 15

            ACCOUNTING; DISTRIBUTION OF PROFITS; PRIORITY OF PAYMENTS

15.1 Pursuant to the  provisions of relevant laws and  regulations,  the General
     Manager of the Joint  Venture will  present the Board with balance  sheets,
     profit and loss statements and other supplementary information requested by
     the Board prepared in Chinese and English on a monthly and quarterly  basis
     and audited financial  statements  (including balance sheets and profit and
     loss statements) on a yearly basis. Such audited financial statements shall
     be  prepared  by  accountant(s)  registered  in  China  with  international
     experience.  The  finance  and  accounting  of the Joint  Venture  shall be
     conducted in accordance with the applicable  accounting laws and principles
     of China.  To the extent  required by relevant law, the Joint Venture shall
     submit on a monthly and annual basis financial  statements to the local tax
     authority,  the  relevant  authorities  in the  electric  industry  and the
     relevant  finance  department.  In the  event  of any  material  difference
     between the  then-applicable  Chinese  accounting  laws and  principles and
     internationally  generally accepted accounting  principles  ('International
     GAAP'),  the Chinese  accounting  laws and  principles  shall be  followed;
     however,  in order to meet the  business and  operation  needs of the Joint
     Venture or if  required  by any Party,  the  General  Manager  shall  cause
     additional  financial  statements  of the Joint  Venture to be  prepared in
     accordance with International GAAP.

15.2 The Joint Venture will adopt financial  accounting systems that will ensure
     that the Joint Venture will:

     (a)  make  and  keep  financial   records  which,  in  reasonable   detail,
          accurately  and fairly  reflect  all  transactions  and affairs of the
          Joint Venture; and

     (b)  maintain  a system  of  internal  accounting  controls  sufficient  to
          provide reasonable assurances that:

          (i)  transactions  are  authorized,  executed  and  recorded  so as to
               provide   for   proper   financial    statements   and   maintain
               accountability for assets; and

          (ii) safeguards   (including  the  performance  of  periodic  physical
               inventories) are established to prevent  unapproved  persons from
               having access to the Joint Venture's assets.

15.3 All vouchers,  books, statements,  reports and other operating,  accounting
     and financial records of the Joint Venture and descriptions thereof will be
     prepared in Chinese and English.

15.4 The  fiscal  year of the Joint  Venture  will begin on January 1 and end on
     December 31 of each  Gregorian  calendar year. The first fiscal year of the
     Joint  Venture will begin on the date of issuance of the  Business  License
     and end on December 31 of that year.

                                      -15-

- ----------
[*** Filed  separately  with the  Commission  pursuant  to a request for
confidential treatment.]


15.5 The Joint Venture will maintain its books of account in Renminbi. The Joint
     Venture may also  maintain  duplicate  books of account in U.S.  Dollars if
     requested  by the  Board.  The Joint  Venture  will also  prepare  separate
     records and  statements  for  transactions  in other foreign  currencies in
     which it has such transactions so that the Joint Venture and each Party can
     inspect the expenditure and income of foreign exchange.

15.6 The Joint  Venture  will  apply its  revenues  according  to the  following
     priorities:  first, to pay amounts then due under the Project Contracts and
     any other contracts to which the Joint Venture may be a Party;  second,  to
     pay other  administrative  and operation  expenses then due;  third, to pay
     taxes of the Joint Venture then due; fourth, to pay principal, interest and
     fees then due in respect of foreign  exchange  loans and to pay  principal,
     interest  and fees then due in respect of Renminbi  loans;  fifth,  to make
     contributions  to the Joint  Venture's  three  funds as provided in Chapter
     15.10;  sixth, to fund the Foreign  Exchange Risk Fund based on the Board's
     decision  pursuant to the provisions  hereof;  and seventh,  to make profit
     distribution  based on the Board's unanimous decision pursuant to the ratio
     of [***]% to the Chinese Party and [***]% to the Foreign Party.

15.7 During the term of the Joint Venture and after  examination and approval by
     the financial  and tax  authorities , the Joint Venture may effect an early
     recovery of investment  to the Foreign Party  pursuant to Article 44 of the
     implementing rules of the Law on Sino-foreign Cooperative Enterprises.

15.8 The Joint  Venture will use Renminbi to effect  payment of locally  sourced
     equipment,  materials,  fuel,  parts  and  other  items  and all  costs and
     expenses   denominated  in  Renminbi.   Subject  to  the  Foreign  Exchange
     Regulations  and so as to minimize the risk of incurring  foreign  exchange
     losses,  the Joint  Venture  will  convert  Renminbi  revenues  to  foreign
     exchange to effect  payment of costs and  expenses  denominated  in foreign
     exchange required to be paid in foreign exchange.

15.9 Unless the Foreign  Party  otherwise  requires,  all  distributions  to the
     Foreign Party  (including any distribution to be made upon a liquidation of
     the Joint  Venture)  will be  remitted  in U.S.  Dollars out of China to an
     account or accounts  designated by the Foreign Party.  Any  distribution to
     the Chinese Party (including any distribution to be made upon a liquidation
     of the  Joint  Venture)  will be in  Renminbi  and will be  remitted  to an
     account or accounts designated by the Chinese Party.

15.10In  accordance  with  Chinese  laws and  regulations  and the  Articles  of
     Association,  the Joint  Venture will make  contributions  each year to the
     Joint Venture's Expansion Fund, Reserve Fund and Bonus and Welfare Fund for
     Staff  and  Workers  in an amount to be  determined  by the Board  from the
     after-tax  profits of the Joint  Venture.  The aggregate  proportion of the
     after-tax profits of the Joint Venture contributed in any year by the Joint
     Venture  to such  funds and any other  funds  will not exceed 15 percent of
     such after-tax profits for the

                                      -16-



          relevant  year. All amounts on deposit in such funds shall be utilized
          only as directed by the Board.


                                   CHAPTER 16

                               SALE OF ELECTRICITY

16.1 The Joint  Venture  will supply to the  Chinese  Party the  electricity  it
     requires to operate  its  Aluminum  Plant  located in Jiaozuo  City,  Henan
     Province,  China  pursuant to an Aluminum Mill Power Supply  Contract.  The
     Chinese Party will pay for the electricity in cash in RMB.

16.2 Any  electricity  generated  by the Joint  Venture  not sold to the Chinese
     Party shall be sold to the Henan Electric Power Corporation pursuant to the
     Power Company Power Purchase and Sale Contract.


                                   CHAPTER 17

                              INDEPENDENT AUDITING

17.1 In the event  either  Party  believes  that a mistake  has been made in the
     preparation  of any of the  financial  reports  enumerated in Chapter 15.1,
     such Party will have the right to appoint an independent auditor to examine
     and verify such report and the costs of the  independent  auditor  shall be
     borne  by the  Party  making  the  request.  Any  such  auditor  will be an
     accountant with international experience registered in China.

17.2 All necessary  documents  and accounts of the Joint  Venture will,  for the
     performance of auditing  under this Chapter,  be provided to the auditor(s)
     according to the reasonable requirements of such auditor(s).

17.3 In the event such  auditor(s)  discover any  material  mistakes in any such
     report,  the Joint  Venture  will cause its  accountant(s)  to restate such
     report  to  correct  such  material   mistakes  in   accordance   with  the
     then-applicable accounting laws and principles of China.


                                   CHAPTER 18

                           FOREIGN EXCHANGE MANAGEMENT

18.1 All  foreign  exchange  matters  of the Joint  Venture  will be  handled in
     accordance  with  the  Foreign  Exchange  Regulations  and  the  provisions
     contained in this Chapter are specifically  subject to the Foreign Exchange
     Regulations.

                                      -17-


18.2 The  Joint  Venture  will  open and  maintain  in its own  name a  Renminbi
     account(s)  at the Bank of China or another  bank located in China which is
     approved by the People's Bank of China.

18.3 The Joint Venture will also open a U.S.  Dollar  account(s) (and such other
     foreign currency  accounts as the Board may decide) at the Bank of China or
     another bank located in China. All foreign exchange income and expenditures
     of the Joint Venture will be paid into and out of such account or accounts.
     The foreign  exchange  funds  maintained in such  account(s) and the income
     thereon shall only be used as permitted under Chinese law.

18.4 The foreign  staff and staff from Hong Kong and Macau of the Joint  Venture
     may remit their  salaries and other income  derived from the Joint  Venture
     out of China after payment of any required tax.

18.5 During the Term, all foreign exchange necessary for the payment of interest
     on and  repayment of principal of the Foreign  Party's U.S.  Dollar  loans,
     distribution  of profits  to the  Foreign  Party and return of its  capital
     shall be handled in  accordance  with the  relevant  state  regulations  of
     foreign exchange control.


                                   CHAPTER 19

                                      TERM

     The term of the Joint  Venture will commence on the date of the issuance of
 the  Business  License and continue for 23 years  thereafter  (including  three
 years of construction)  unless  terminated prior thereto in accordance with the
 provisions of this Contract or as extended by written  agreement of the Parties
 (the 'Term').


                                   CHAPTER 20

                                    INSURANCE

     The Joint Venture will maintain such insurance  policies as are required to
 be  maintained  by the Joint  Venture as  determined by the Board of Directors.
 Such  policies  will be  obtained  from  appropriate  companies  licensed to do
 business  in China  and will be  denominated  in  Renminbi  and/or  in  foreign
 currencies as determined by the Board, and will comply with applicable  Chinese
 laws and regulations.

                                      -18-


                                   CHAPTER 21

                                    LAND USE

     After establishment of the Joint Venture, the Joint Venture will enter into
 the Site Use  Contract.  Upon  execution of the Site Use  Contract,  a land use
 certificate  will be  issued  to the Joint  Venture  allowing  it full land use
 rights  necessary for the construction and operation of the Power Plant for the
 Term.


                                   CHAPTER 22

                                 APPLICABLE LAW

     The formation, validity, interpretation and implementation of this Contract
 shall be governed  by and  construed  under the  publicly  promulgated  laws of
 China.


                                   CHAPTER 23

                        EFFECTS OF CHANGES IN CHINESE LAW

     In the event the Joint Venture is unable to realize the operating objective
 expected  by the  Parties  or any  Party's  interest  is  materially  adversely
 affected  due to a major  change  in  operating  environment  (including  legal
 environment, changes, amendments or supplements to any existing, or the passage
 of any new,  national,  provincial,  municipal,  local or other  law,  statute,
 ordinance,  rule  or  regulation,  or  interpretation  thereof  by  any  court,
 administrative  agency or other government authority after the approval of this
 Contract),  upon the  receipt of a written  request of any Party,  the  Parties
 shall promptly make  amendments to this Contract so as to protect the interests
 of the  Parties  under  this  Contract.  In the  event  that  any  new  laws or
 regulations are promulgated by the Chinese  government which are more favorable
 to the Joint  Venture,  the Joint Venture shall apply for the enjoyment of such
 preferential treatment.


                                   CHAPTER 24

                               BREACH OF CONTRACT

     A Party will be in breach of this Contract if:

     (a)  it fails fully to perform,  or suspends its performance of, any of its
          obligations  under  this  Contract  and if it does  not  correct  such
          failure or  suspension  after notice  thereof  from the  non-breaching
          Party  within  30  days  or,  if such  failure  or  suspension  cannot
          reasonably be corrected within 30 days, within such longer period (not
          to exceed 180 days) as may  reasonably  be  required  to correct  such
          failure or suspension;

                                      -19-


     (b)  any representation  made by it in Chapter 2.2 or 2.3 shall prove to be
          untrue in any material respect as of the date on which it was made: or

     (c)  it fails to fund any  installment  of its  portion  of the  registered
          capital  of the  Joint  Venture  within  two  days  of the  date  such
          installment was due pursuant to Chapter 5.4.

     The breaching Party shall indemnify the Joint Venture and the non-breaching
     Party in respect of any loss incurred (excluding  consequential  damages or
     special damages) as a result of such breach, together with interest thereon
     from the date  any  such  loss  shall  have  occurred  through  the date of
     payment, calculated at the rate of 15% per annum.


                                   CHAPTER 25

                                   TERMINATION

25.1 The Joint Venture will terminate on the expiration of the Term.

25.2 Prior to the  expiration  of the  Term,  this  Contract  may be  terminated
     pursuant to any of the following provisions:

     (a)  Upon the  occurrence  and during the  continuance  of a breach of this
          Contract under Chapter 24, the non-breaching  Party may terminate this
          Contract by giving written notice to the breaching Party;

     (b)  In the event the Power Company Power Purchase Contract or the Aluminum
          Mill Power Supply Contract shall at any time be terminated as a result
          of the  occurrence  of an event of force  majeure,  the  Parties  will
          consider the viability of continuing the business of the Joint Venture
          and the feasibility of obtaining substitute electricity  purchaser(s),
          and,  if such  substitute  electricity  purchaser(s)  is not  obtained
          within six months after such  termination  of the Power  Company Power
          Purchase  Contract or the  Aluminum  Mill Power Supply  Contract,  the
          Board may vote to terminate this Contract;

     (c)  If the Joint  Venture is unable to lawfully  continue  its  operation,
          either Party may terminate  this Contract by giving  written notice to
          the other Party;

     (d)  If all or a material  portion of the assets or properties of the Joint
          Venture or a Party shall have been expropriated or requisitioned, such
          Party may  terminate  this  Contract by giving  written  notice to the
          other Party; or

     (e)  If  the  Joint  Venture  fails  to  make  a  payment  when  due on any
          shareholder  loan provided by a Party,  such Party may terminate  this
          Contract by giving written notice to the other party.

                                      -20-

- ----------
[*** Filed  separately  with the  Commission  pursuant  to a request for
confidential treatment.]


                                   CHAPTER 26

                                   LIQUIDATION

26.1 The Joint Venture shall be liquidated and dissolved upon the termination of
     this  Contract  pursuant to Chapter 25,  provided that an  application  for
     approval  shall  be  submitted  to the  relevant  examining  and  approving
     authority  in order to  terminate  this  Contract  and  dissolve  the Joint
     Venture  prior to the end of the Term as provided in Chapter  25.2.  In the
     event that the Joint  Venture is dissolved  pursuant to Chapter 25.1 and if
     at the time of such  dissolution the Foreign Party has recovered its entire
     contribution  to the  registered  capital of the Joint  Venture,  the fixed
     assets,  including working capital,  comprising the Power Plant will belong
     to the  Chinese  Party for free and all other  assets of the Joint  Venture
     will be distributed to the Chinese Party and the Foreign Party according to
     a  unanimous  decision  of the  Board  based on the  ratio of [***]% to the
     Chinese Party and [***]% to the Foreign Party.

26.2 If by application of the provisions contained in Chapter 26.1 the assets of
     the Joint Venture are to be liquidated,  a Liquidation  Committee (composed
     of Board members or other qualified persons, including, without limitation,
     certified  accountants or attorneys) will be  established,  composed of two
     members  appointed by the Chinese  Party and four members  appointed by the
     Foreign Party.  The Liquidation  Committee will have the power to represent
     the Joint  Venture in all legal  matters  concerning  the  liquidation.  In
     accordance with applicable  Chinese laws and  regulations,  the Liquidation
     Committee will value and liquidate the Joint Venture's  assets based on the
     Joint  Venture's  going  concern  value,  taking  into  account  the actual
     circumstances  of the Joint  Venture,  the  market  value of  companies  in
     similar industries and internationally accepted principles of valuation.

26.3 The Liquidation  Committee will conduct a thorough examination of the Joint
     Venture's assets and  liabilities.  On the basis of such  examination,  the
     Liquidation   Committee  will  develop  a  liquidation   plan,   under  the
     supervision of the  department-in-charge,  for the liquidation of the Joint
     Venture. The liquidation plan will be subject to approval by the Board. All
     actions of the  Liquidation  Committee  will be subject to  approval of all
     members  of  the  Liquidation  Committee.  No  member  of  the  Liquidation
     Committee  shall have the power to take any action binding the  Liquidation
     Committee or the Joint  Venture  without the express  authorization  of the
     majority members of the Liquidation Committee.

26.4 Upon completion of all liquidation  procedures,  the Liquidation  Committee
     shall submit its final report, after approval by the Board, to the approval
     and examination authority,  and shall nullify the registration of the Joint
     Venture.  The  Parties  will have the  right to obtain  copies of the Joint
     Venture's  accounting books and other documents,  but the originals thereof
     shall be left in the care of the Chinese Party.

                                      -21-

[*** Filed  separately  with the  Commission  pursuant  to a request for
confidential treatment.]



26.5 Upon liquidation resulting from an early termination of this Contract,  the
     Joint  Venture's  assets  will  be  applied   according  to  the  following
     principles and order:

     (a)  to payments of all liquidation expenses;

     (b)  to payments of salary,  insurance and benefits of the employees of the
          Joint Venture;

     (c)  to  payments  then  due  under  any  contracts  or in  respect  of any
          indebtedness of the Joint Venture;

     (d)  to  payments  of  interest  and fees then due with  respect to foreign
          currency loans;

     (e)  to  payments of  interest  and fees then due with  respect to Renminbi
          loans;

     (f)  to payments of taxes of the Joint Venture then due;

     (g)  to payments of principal of foreign loans;

     (h)  to payments of principal of Renminbi loans;

     (i)  to repayments of registered  capital to the Parties in accordance with
          the decision of the Board; and

     (j)  to  distributions to the Chinese Party and the Foreign Party according
          to the ratio of [***]% to the Chinese  Party and [***]% to the Foreign
          Party based on a unanimous decision of the Board.


                                   CHAPTER 27

                                  FORCE MAJEURE

     In the event  that  earthquake,  typhoon,  flooding,  fire or war  directly
 affects the performance of this Contract or makes it impossible to perform this
 Contract in accordance with the terms hereof,  the Party affected by such force
 majeure  shall  immediately  notify  the  other  Party of such  event and shall
 provide  details of such event and effective  documentary  evidence in a timely
 manner. On the basis of the degree to which the performance of this Contract is
 affected,  the  Parties  shall  discuss  whether to  terminate  this  Contract,
 partially  excuse the obligation to perform this Contract or delay  performance
 of this Contract.

                                      -22-

                                   CHAPTER 28

                             SETTLEMENT OF DISPUTES

28.1 Any dispute  arising out of or in  connection  with this  Contract  will be
     attempted to be settled through friendly  consultation between the Parties.
     Such  consultation  will begin immediately after either Party has delivered
     to the other Party a written request for such consultation.  If the Parties
     do not reach an  amicable  solution  within 30 days from the notice of such
     dispute,  either  Party may,  with  notice to the other  Party,  submit the
     dispute for binding arbitration in Stockholm,  Sweden under the auspices of
     and in accordance with the Arbitration  Rules of the Arbitration  Institute
     of the Stockholm  Chamber of Commerce (except to the extent this Chapter 28
     specifies  different  procedures in which event such procedures will govern
     the  arbitration  to the extent so  specified).  The Parties agree that any
     dispute  arising  out  of or in  connection  with  this  Contract  will  be
     submitted exclusively to and be finally settled by arbitration irrespective
     of the magnitude of such dispute or whether such dispute would otherwise be
     considered  justiciable  or ripe  for  resolution  by a court  or  arbitral
     tribunal.  Any settlement  and award  rendered  through such an arbitration
     proceeding will be final and binding upon the Parties if the decision is in
     writing  and  contains  a reasoned  analysis  explaining  the  arbitrators'
     reasons  for  rendering  the  award.  This  Contract  and  the  rights  and
     obligations of the Parties will remain in full force and effect pending the
     award in such arbitration proceeding.

28.2 The arbitration will be conducted in English and Chinese.

28.3 There will be three  arbitrators.  Each Party  will  select one  arbitrator
     within 30 days after giving or receiving the demand for  arbitration.  Such
     arbitrators will be freely selected, and the Parties will not be limited in
     their selection to any prescribed list.  Within 30 days after the selection
     of the  latter of the two  arbitrators  selected  by the  Parties,  the two
     arbitrators  shall select the third  arbitrator;  if the two arbitrators do
     not select the third within such 30 day period,  the arbitrating  body will
     select the third arbitrator.  If a Party does not appoint an arbitrator who
     has  consented  to  participate  within 30 days after the  selection of the
     first arbitrator,  the relevant appointment will be made by the arbitrating
     body.  The  costs  of the  arbitration  will be  borne  by the  Parties  as
     determined  by the  arbitration  tribunal  taking into account the relative
     merits of the positions of the Parties.

28.4 The  Parties  agree that the  arbitral  award may be  enforced  against the
     Parties or their assets wherever they may be found and that a judgment upon
     the arbitral award may be entered in any court having jurisdiction thereof.
     Accordingly,  the Parties irrevocably agree that any action to enforce such
     judgment  may be  instituted  wherever  appropriate  and each Party  hereby
     irrevocably  waives,  to the fullest extent permitted by law, any objection
     which  it may have  now or  hereafter  to the  laying  of the  venue or the
     jurisdiction  or the  convenience  of the  forum  of any  such  action  and
     irrevocably  submits generally and  unconditionally  to the jurisdiction of
     any such court in any such action.

                                      -23-


28.5 Each of the Parties is subject to civil and  commercial law with respect to
     its obligations  under this Contract,  and the execution and performance of
     this Contract by it  constitutes  private and  commercial  acts rather than
     governmental and public acts. Each of the Parties  irrevocably  agrees that
     this Contract is a commercial rather than a public or governmental activity
     and that neither Party is entitled to claim immunity from legal proceedings
     with  respect to itself or any of its assets on the grounds of  sovereignty
     or otherwise  under any law or in any  jurisdiction  where an action may be
     brought for the  enforcement  of any of the  obligations  arising  under or
     relating to this Contract.  To the extent that either of the Parties or any
     of their  assets has or  hereafter  may acquire any right to immunity  from
     set-off, legal proceedings,  attachment prior to judgment, other attachment
     or execution of judgment on the grounds of sovereignty  or otherwise,  such
     Party hereby  irrevocably  waives such rights to immunity in respect of its
     obligations arising under or relating to this Contract.


                                   CHAPTER 29

                     NON-DISCLOSURE OF BUSINESS INFORMATION

29.1 During the term of this Contract, the Parties may, upon reasonable request,
     furnish  each  other  and  the  Joint  Venture  with  proprietary  business
     documents and information needed for the implementation of this Contract.

29.2 The Parties agree that all proprietary  business  documents and information
     which are  disclosed by either  Party to the Joint  Venture or to the other
     Party, either directly or indirectly,  in writing, orally or by drawings or
     inspection will be used only for the Joint Venture's legitimate  commercial
     purposes as specified in this Contract.

29.3 Each Party  agrees  that it will  furnish,  and cause the Joint  Venture to
     furnish,  such  documents and  information  the same degree of  proprietary
     treatment  as the Party gives to its own similar  proprietary  documents or
     information.

29.4 Each  Party  agrees not to  disclose,  and cause the Joint  Venture  not to
     disclose,  any such proprietary documents or information to any third Party
     or to any of its employees, except to its advisors, attorneys,  engineering
     consultants and lenders under  confidentiality  arrangements  substantially
     similar to those set forth in this Chapter and to those  employees  who are
     required to have such  proprietary  documents and  information to carry out
     the commercial purposes of the Joint Venture.

29.5 Notwithstanding  the  foregoing,  the following  will not be subject to the
     undertakings set forth in this Chapter:

     (a)  documents  already in the possession of, or information  already known
          to,  the  Joint  Venture  or the  Party  receiving  the  documents  or
          information  before its initial  disclosure by the other Party through
          no breach of any  confidentiality  obligation to or for the benefit of
          the disclosing Party;

                                      -24-


     (b)  documents  or  information  in  the  public  domain  at  the  time  of
          disclosure,  or which  after such  disclosure  enters  into the public
          domain  through  no fault of Joint  Venture  or the  Party to whom the
          information was disclosed; and

     (c)  documents or  information  lawfully  furnished or disclosed by a third
          Party to the Joint Venture or the Party  receiving the  information or
          documents.


                                   CHAPTER 30

                                  MISCELLANEOUS

30.1 This Contract has been written in Chinese and English and each such version
     will be of equal force and effect. All documents,  notices, waivers and all
     other communications written or otherwise between the Parties in connection
     with this  Contract  will be in the  Chinese  and  English  languages.  All
     numbers in  contracts  of the Joint  Venture,  books of account and records
     will be Arabic.

30.2 Any  modifications  to this Contract  will be subject to written  agreement
     signed by the  authorized  representatives  of both Parties and will become
     effective  upon the  approval  of the  original  approval  and  examination
     authority of this Contract.

30.3 Subject to the provisions of Chapter 23, in the event any provision of this
     Contract is  determined  to be invalid or  unenforceable  under  applicable
     Chinese laws,  all other  provisions of this Contract will continue in full
     force and effect.  The  Parties  will,  in such event,  replace the invalid
     provision with a valid provision  which as closely as possible  corresponds
     to the spirit and purpose of such invalid provision and this Contract.

30.4 After  termination  of  this  Contract,  the  relevant  provisions  of this
     Contract  which form the basis for a valid  claim by either  Party  arising
     from or in  connection  with this Contract will remain in effect as related
     to the  settlement  of such claim until such claim is settled.  The dispute
     resolution  provisions of Chapter 28 and the confidentiality  provisions of
     Chapter 29 will also remain in effect after termination of this Contract.

30.5 A failure or delay by either Party to require the enforcement of any of the
     provisions of this Contract will not be construed as a waiver by such Party
     of any of its  rights  nor will it affect in any way the  validity  of this
     Contract or any of its provisions at any time thereafter.

30.6 Neither of the  Parties  will act on behalf of the other  Party,  which can
     only become bound by the signature of its own authorized representative. In
     all circumstances, the Joint Venture will act only in its own name and will
     not be  considered  to be the agent of either  of the  Parties.  Similarly,
     unless  expressly  provided  otherwise in a signed writing,  neither of the
     Parties is the agent of the

                                      -25-


     Joint Venture and, therefore,  neither of the Parties is entitled to assume
     any obligation on behalf of the Joint Venture nor to bind the Joint Venture
     in any way whatsoever.

30.7 This Contract  constitutes the entire  agreement and  understanding  of the
     Parties  with  respect to the  subject  matter  hereof and  supersedes  all
     documents  and  correspondence  entered  into prior to this  Contract  with
     respect to the subject matter hereof.

30.8 Any notice or other communication to be given hereunder shall be in writing
     and  shall be  sufficiently  given if,  in the case of the  Chinese  Party,
     addressed as set forth in Chapter 2.1 and in the case of the Foreign Party,
     addressed to: AES China Generating Co. Ltd., 7/F, Allied Capital  Resources
     Building,   32-38  Ice  House   Street,   Central,   Hong  Kong,   Telefax:
     852-2530-1673,  Attention:  President,  and sent by  registered  mail or an
     internationally  recognized  overnight  courier service,  hand-delivered or
     transmitted and clearly received by facsimile transmission. Any such notice
     shall be effective only upon actual receipt  thereof.  All notices given by
     facsimile shall be confirmed in writing, sent as aforesaid, but the failure
     to so confirm  shall not  vitiate the  original  notice.  Either  Party may
     change its address for purposes of receiving notices hereunder by notice to
     the other Party given in accordance with this Chapter 29.8.

30.9 The titles and headings  herein are used for  convenience of reference only
     and  shall  not  be  deemed  part  of  this   Contract   for   purposes  of
     interpretation.  Unless  otherwise  stated,  all  references  made  in this
     Contract to 'Chapters,' shall refer to Chapters of this Contract.

30.10In  the  event  that  there  is  any  conflict  or  contradiction   between
     provisions of this Contract and provisions of the Articles of  Association,
     provisions of this Contract shall prevail.

                                      -26-


30.11This Contract is executed on March 27, 1996 in Jiaozuo,  People's  Republic
     of  China,  in four  sets of  English  and  Chinese  originals  by the duly
     authorized  representatives  of the  Parties.  This  Contract  shall become
     effective on the date the certificate of approval relating to this Contract
     is issued by MOFTEC.


JIAOZUO ALUMINUM MILL


By: /s/ [SIGNATURE ILLEGIBLE]
- ----------------------------
Name: Jin Bao Qing
Title: General Manager
Nationality: Chinese



JIAOZUO POWER PARTNERS, L.P.
by Jiaozuo (GP) Corporation,
its General Partner

By: /S/ Edward C. Hall III
- -------------------------
Name: Edward C. Hall III
Title: Vice President
Nationality:  U.S.A.



                                      -27-