The recent substantial increase in mineral leasing activityand prices in the area, including the entry of established E&P companies, lendscredence to this assessment.CMR’s initial and present objectives are (1) to assemble and consolidate ameaningfully large leasehold acreage position; and (2) to establishgeotechnical baselines needed to identify and prioritise the best play types.The technical baselines will guide the conduct of subsequent drilling and otherfield testing to establish production and quantify reserves. CMR’s primebusiness strategy is to capture the large step-up in value attendant uponestablishing production and demonstrating viable reservoir characteristics onCMR’s lands. Subsequently, there will be opportunity to evaluate options forsale, merger or joint venture to monetise and/or further develop CMR’s assets.The Company’s investment of US$1.5m comprises an interest in BI CMR III LLC, aspecial purpose vehicle which exists to hold equity investments in CMR. * China manufacturing surveys suggest recovery sustainable China  |  Japan  |  South Korea * Output at year high, overseas orders at 11-month high * Markets wary of signs of green shoots in Japan (Adds comments by c.bank adviser, economists, market reaction) By Alan Wheatley and Simon Rabinovitch BEIJING, July 1 (Reuters) – China’s manufacturing sectorextended a steady if unspectacular recovery in June, surveysreleased on Wednesday showed, adding to evidence across Asiathat the regional economy is finally pulling out of a deepdive.

“I believe the current recovery has been confirmed and canbe sustained,” Fan Gang, an economist who advises the centralbank, told a financial forum. Fan predicted China’s exports will be growing again, from alow base, by the end of the year. [ID:nPEK153534] The official purchasing managers’ index (PMI) for June roseto 53.2 from 53.1 in May, consolidating for the fourth month ina row above the watershed mark of 50. A companion index compiled for brokerage CLSA improved to51.8 from 51.2, its third month in positive territory, asoutput grew at the strongest rate in a year and overseas ordersrose for the first time in 11 months. [ID:nBJB000639] A reading over 50 indicates an expansion in manufacturingsector, while one below 50 suggests contraction. “We take it as signalling that the green shoots of economicrecovery have taken root and are likely to blossom in thesecond half of 2009,” Steven Zhang and Qing Wang at MorganStanley said in a note to clients. Beijing responded to last autumn’s slump in global demandwith a massive 4 trillion yuan ($585 billion) stimulus package,ultra loose credit policy and an array of tax breaks.

Alongside improvements in other timely data such as powerconsumption, tax revenues, industrial profits and cars sales,Wednesday’s reports indicate that the pump-priming is working. For a graphic on China’s PMI trends, click on:here GLIMMERS OF HOPE China accounts for only 7 percent of global output atmarket rates, so it cannot be expected to haul the rest of theworld out of recession. But global investors have respondedpositively to the improved news flow recently out of Beijing. Japanese construction makers such as Komatsu (6301.T) andHitachi Construction (6305.T), which often rise when there areexpectations of orders to be won in China, gained 1.8 percentand 1.6 percent, respectively, on Wednesday. The surveys alsohelped to underpin a rebound in oil prices [ID:nSYD519481] Shanghai’s main stock index .SSEC jumped 1.7 percent to a13-month high. Shares across the region, by contrast, werelittle changed as investors took the view that a turnaround toglobal recovery was likely to be a slow grind.

For instance, the Bank of Japan’s closely watched tankanbusiness survey for June showed corporate confidence improvingfrom record lows plumbed three months ago. But the survey’s main sentiment index for big manufacturersdid not recover as much as the market expected. It reachedminus 48 from minus 58 in March, below forecasts of a minus 43reading. “The overall impression is that Japanese firms are facing amore severe situation than market players think,” said SusumuKato, chief economist at Calyon Capital Markets Japan. The recovery in export business revealed in the Chinesesurveys was partially reflected in South Korea, where exportsfell by 11.3 percent in June from a year earlier, the slowestdecline since October. “The worst is apparently behind us, and the economy isgearing for a faster-than-expected recovery,” said SongJae-Hyok, an economist at SK Securities. A survey of Indian manufacturers was also broadly positive,with domestic demand boosting activity to an eight-month high.

Economists at J.P Morgan last Friday raised theirprojection for second-quarter gross domestic product growth inemerging Asia, forecasting quarter-on-quarter growth of morethan 10 percent at an annualised rate. That reflectsassumptions that quarter-on-quarter growth in industrial outputwill surge at a 35 percent annualised pace — and nearly 40percent in China’s case. The World Bank, the Organisation for Economic Cooperationand Development and a clutch of banks have all upgraded theirgrowth forecasts for China in the past two weeks. The government’s goal of 8 percent GDP growth for all of2009, once dismissed as fanciful, now looks attainable. Andy Rothman, CLSA’s China macro strategist, reaffirmed histarget of 8 percent but said the risks were now clearly on theupside. “It is now safe to say that a sustainable recovery iswell under way in China,” he said in a note to clients. Likewise, Mingchun Sun with Nomura in Hong Kong said thebuyers’ surveys suggested that the revival in manufacturing wasgaining a stronger foothold and reaffirmed his forecast of 8percent GDP growth this year and 10 percent in 2010 Not everyone is getting carried away.