Reuters reported that Oil giant Sinopec Corp along with Chinese banks are in talks to put up to USD 1 billion in a Texas clean energy project, in what would be one of the biggest investments by Chinese companies in the US power sector.

The Chinese group is looking to acquire an equity stake in and provide financing to the roughly USD 2.5 billion Texas Clean Energy Project, which is being developed by Seattle-based Summit Power Group.

Sinopec Group, PetroChina and CNOOC Ltd have been leading Asia's oil and gas acquisitions overseas with Chinese purchases totaling USD 5.1 billion in the first half of this year. That compares to USD 16.3 billion last year and USD 23.4 billion in 2010.

China strong interest in North American energy assets, particularly CNOOC recent USD 15.1 billion bid for Canada Nexen has raised alarm bells among a handful of US lawmakers who fear America's national security interests could be undermined.

Summit Power which is also in talks with other potential investors in the United States and Europe, is seeking to carve out a role for Chinese investors that does not upset existing engineering and construction agreements. An agreement between Sinopec and Summit Power could be announced as early as September.

People familiar with the negotiations said but many of the details, including specific financial terms and the size of the equity stake, have yet to be decided.

China investment will be a significant share of the project's cost, consisting partly of debt and partly of equity.

Source - Reuters

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