Sinopec wins first shale gas tender

China has awarded two out of four shale gas blocks offered in its first auction of the unconventional gas resource to China Petroleum & Chemical Corp (Sinopec) and a provincial coal seam gas company, a central government official said on Wednesday.

"Both blocks are in the Chongqing area. The contracts will be signed shortly," an official with the Ministry of Land and Resources told Reuters.

Sinopec won the Nanchuan block and Henan Provincial Coal Gas Development and Utilisation Co was awarded the Xiushan block, said the official, without elaborating.

The two blocks, near Chongqing, each cover an area of about 2,000 square kilometers.

BYD ends auto financing JV

BYD Co will end a joint venture with Compagnie Generale de Location d'Equipements because of differences in operation strategies.

Compagnie Generale, also known as CGL, will need to pay 2.25 million yuan ($347,861) by July 31 to cover expenses incurred in the preparation of the venture, Shenzhen-based BYD said in a statement to the city's stock exchange on Wednesday.

Gome teams up with UK's Tesco

Gome Electrical Appliances Holding Ltd has teamed up with Tesco Plc, the world's third-biggest retailer, to jointly expand their presence in China to tap rising consumption.

China's second-largest homegrown electronics appliance distributor said in a statement on Wednesday it had entered into an agreement with Tesco Property Ltd, a unit of the British supermarket group. GOME operates its own outlet in Tesco's Lifespace shopping malls in China. Tesco operates four Lifespace shopping malls in China.

CSR Times sees H1 profit rise

Zhuzhou CSR Times Electric Co said it expects a "significant increase" in profit for the six months ended June 30 compared with a year earlier as sales volume rose, according to a statement to the Hong Kong Stock Exchange on Wednesday.

Stocks drop on debt concerns

Hong Kong stocks fell on Wednesday, led by mainland banks after Temasek Holdings Pte sold stakes in two of the country's largest lenders amid concern over banks' capacity to absorb losses on defaults should property prices drop.

The Hang Seng Index (HSI) slipped 1 percent to 22517.55 at the close. Losses deepened after Dublin-based NCB Stockbrokers said Ireland may have its sovereign credit rating cut by Moody's if the agency considers re-entry into bond markets a factor. The Hang Seng China Enterprises Index fell 1.9 percent to 12598.34. The HSI Volatility Index gained 0.2 percent to 17.80.

Temasek sold about HK$18.8 billion ($2.4 billion) of shares in Bank of China and about HK$9.4 billion of China Construction Bank stock, according to term sheets obtained by Bloomberg News on Tuesday.

A gauge of finance stocks was responsible for more than 70 percent of the HSI's decline on Wednesay.

China Construction Bank fell 3.2 percent to HK$6.27 on Wednesday. Bank of China declined 3.6 percent to HK$3.72. Industrial & Commercial Bank lost 2.5 percent to HK$5.78.

Oil stocks, which climbed earlier in the day as crude oil futures traded near a three-week high, later reversed gains. PetroChina Co closed down 0.4 percent at HK$11.52. Cnooc Ltd ended down 0.5 percent at HK$18.30. Aluminum Corp of China Ltd fell 2.5 percent to HK$6.36.

Bloomberg - Reuters

(HK Edition 07/07/2011 page2)