A major new deal has underlined the potential of the Mississippi Lime shale play in Oklahoma.

Chinese oil giant Sinopec has reportedly struck a $1bn deal to buy stakes in Chesapeake Energy's assets in the Mississippi Lime.

The deal, valued at an estimated $2,400 per acre, gives Sinopec a 50% stake in the American firm's projects.

It latest deal is another sign of China's significant interest in US shale assets following Sinochem's $1.7bn investment in Texas's Wolfcamp shale and after China National Offshore Oil Company (CNOOC) stumped up over $15bn to buy Nexen.

Many small cap investors in the UK will be familiar with the potential of the Mississippi Lime, with Magnolia Petroleum (LON:MAGP) and newly listed Northcote Energy (LON:NCT) both building their businesses with a focus on the emerging shale region.proactiveinvestors.co.uk