<a href=Nexen” height=”333″ src=”https://www.offshore-technology.com/wp-content/uploads/static-progressive/nri/offshore/450px-Nexen_Building.JPG” style=”padding: 10px” width=”250″ />

China National Offshore Oil (CNOOC) has received final approval from the Committee on Foreign Investment in the United States (CFIUS) to acquire Canada-based oil and gas company Nexen for $15.1bn.

Nexen has said in a statement that the deal is expected to close in the week of 25 February 2013, seven months after China’s major offshore oil and gas producer made its bid of $27.50 a share.

However, the company did not specify whether CFIUS had imposed conditions on the approval.

The deal was supported by Canadian authorities, but required US approval.

Following completion of the acquisition, CNOOC will gain rights to new offshore production in the North Sea, the Gulf of Mexico and off western Africa, in addition to producing assets in the Middle East and Canada, reported Reuters.

CNOOC will also gain control over Nexen’s Long Lake oil sands project in the province of Alberta, Canada, as well as billions of barrels of reserves in the world’s third-largest crude storehouse.

The US authority approved the deal, even though widespread distrust of US investments by Chinese companies has continued since 2005, when CNOOC made an attempt to acquire Unocal for $18.5bn, a deal which collapsed on US national security concerns.

Bracewell & Guiliani senior counsel Joshua Zive was quoted by Reuters as saying that CNOOC’s achievement in steering the CFIUS approval process "is likely to be viewed as a positive development".

"That, in the current climate, is a moment of significance," Zive added.

A US legislator was quoted by the news agency as saying that he intended to introduce legislation to deter any future transactions similar to the Nexen deal, which involved the transfer of royalty-free leases.

House Natural Resources Committee ranking Democrat representative Edward Markey said: "Chinese Government-owned oil corporations should not be allowed to drill for American oil in the Gulf of Mexico without paying a dime in royalties to US taxpayers."


Image: Nexen Building, Calgary, Alberta. Photo courtesy of Shaun Adamson.

Energy