Chinese investment holding company Yantai Xinchao Industry Co. Ltd. said it will buy oil fields in the U.S. state of Texas for 8.3 billion yuan ($1.3 billion), U.S. media reported Monday.
The Chinese company will buy oil fields in western Texas from Nevada-based Tall City Exploration and Plymouth Petroleum.
West Texas is home to the oil and gas-rich Permian basin, which has been a key region for the U.S. shale revolution since 2008. The region is known for its low drilling costs and close proximity to U.S. refineries on the Gulf coast.
While U.S. oil producers' investments and expenditures are under pressure with low oil prices, Chinese capital injection may help the Permian basin boost its oil production, although this is not the first investment made by Chinese energy companies in the U.S.
Yantai Xinchao said it has received approval from the U.S.' Committee on Foreign Investment for the acquisition, according to U.S. media.
By Ovunc Kutlu
Anadolu Agency
ovunc.kutlu@aa.com.tr