CNOOC to acquire Nexen for $15.1bn

The Chinese oil and gas explorer's takeover of the Canadian firm expands its overseas businesses and resource base.

New Statesman
CNOOC's oil rig and the Bohai Shiji FPSO vessel. Credit: Getty Images.

The Chinese state-controlled oil and gas explorer CNOOC has signed an agreement to acquire the Canadian energy firm Nexen for approximately $15.1bn in cash, or $27.50 per common share.

The transaction, expected to close in the fourth quarter of 2012, will improve CNOOC’s presence in Canada, Nigeria and the Gulf of Mexico and adds a significant presence in the North Sea and diversifies its growth platform.

Nexen said its assets in the UK, US and other countries will continue to be managed from its regional offices and CNOOC will retain the current management and employees in those operations, as well as continue to work with local suppliers.

Li Fanrong, CEO of CNOOC, said:

We believe the transaction provides a number of significant benefits to Canada and to Nexen. CNOOC Limited looks forward to welcoming all of Nexen's employees to its worldwide team and we will clearly benefit from having Nexen employees play an important part in our international business growth platform. In addition, the transaction is a reflection of our disciplined M&A strategy which is focused on resources, risk and return.

Kevin Reinhart, interim CEO of Nexen, said:

CNOOC Limited is one of the largest independent oil and gas exploration and production companies in the world. This transaction will allow for significant investment in our business and opens the door to new opportunities for our employees.

After completion of this acquisition, CNOOC is planning to establish Calgary as the head office of its North and Central American operations and will retain Nexen’s current management team and employees.