Calgary, Alberta: US regulators approved the $15.1 billion takeover of Canadian oil and gas company Nexen Inc. by China’s state-owned CNOOC Ltd, removing the final hurdle to the Asian country’s largest-ever foreign takeover.
Calgary, Alberta-based Nexen said on Tuesday the Committee on Foreign Investment in the United States (CFIUS) had given the final green light needed for the acquisition.
It expects the deal to close in the week of 25 February, seven months after China’s top offshore oil and gas producer made its bid of $27.50 per share.
The acquisition gives CNOOC new offshore production in the North Sea, the Gulf of Mexico and off western Africa and producing properties in the Middle East, as well as in Canada.
CNOOC gains control of Nexen’s Long Lake oil sands project in Canada’s oil-rich province of Alberta and billions of barrels of reserves in the world’s third-largest crude storehouse.
Canada approved the contentious takeover late last year despite misgivings from members of the ruling Conservative Party concerned about China’s human rights record. But Canada also insisted this was the last deal of its kind that it would approve, drawing a line in the sand against state-controlled companies taking majority stakes in the strategic oil sands.
US approvals, needed because of Nexen’s Gulf of Mexico holdings, were slower as legislators examined whether the deal would threaten US national security.
The US has traditionally been more wary than Canada of Chinese investment, prompting some speculation that Washington might want Nexen to dispose of the US assets.
Nexen did not indicate in its release whether CFIUS had imposed conditions on the approval and the company was not immediately available for comment.
In 2005, the US blocked CNOOC’s bid for Unocal Corp because of national-security concerns. An influential House committee last year urged US companies not to do business with Chinese telecommunications firms such as Huawei Technology Co. Ltd and ZTE Corp. for fears that China could use equipment made by the two to spy.