China has a growing interest in United States energy resources. Yantai Xinchao Industry Co. Ltd., a Chinese investment firm holding company, has signed a letter of intent to purchase oil fields in Texas, which are currently owned by Plymouth Petroleum and Tall City Exploration (two Nevada-based companies), for $1.3 billion.

According to a stock exchange filing submitted over the weekend, the deal is part of a complex transaction between Yantai Xinchao and a second Chinese firm. In the filing, Yantai Xinchao stated that it signed a letter of intent late last week with Ningbo Dingliang Huitong Equity Investment Center and its seven shareholders to buy the Texas oil fields through a subsidiary, Moss Creek Resources LLC.

The filing also said that the purchase, which includes oil fields in west Texas’ Howard and Borden counties, has already been approved by the United States Committee on Foreign Investment.

Many smaller Chinese gas and oil companies are currently looking for deals overseas as a way to fight heavy government regulations in their home country as well as competition from giant state-owned energy firms. The Wall Street Journal reports that, “Chinese companies are looking abroad for oil deals partly because of tight restrictions at home, making investment in oil-and-gas exploration and production next to impossible in many cases. State-owned oil behemoths dominate China’s energy landscape, leaving little space for independent companies to invest. China’s government says it aims to bring more private capital into the oil sector as part of ongoing reforms.”

The Journal further reports that Chinese companies wish to do business in the United States because of “stable laws governing oil exploration and production.” However, “U.S. restrictions on Chinese investment in potentially sensitive areas means investment in the U.S. energy patch by Chinese companies is, to date, limited.”

As smaller Chinese countries look to the United States, China’s largest state-owned oil and gas firms are busy buying natural resources in countries such as Kazakhstan and Mozambique.

As a result of the financial restructuring and oil field purchase, Yantai Xinchao shares were suspended from trading last Friday. The company predicts that shares will be suspended for about one month.