China Light and Power, Hong Kong's largest energy company, hopes shortly to finalise a provisional natural gas contract with the UK's BG Group worth billions of dollars in spite of a government agreement that appeared to redirect the lucrative supply arrangement to two Chinese state-controlled oil and gas companies.

In a bilateral memorandum of understanding announced last week by the Hong Kong and Chinese governments, Beijing said it would support the 20-year renewal of existing supply arrangements from China National Offshore Oil Corporation's gas fields in the South China Sea.