CNOOC Finally Gets Nexen - Analyst Blog
February 26 2013 - 10:20AM
Zacks
China’s largest offshore oil
producer, CNOOC Ltd. (CEO), announced today that
it has finally wrapped up the $15.1 billion acquisition of Canada’s
Nexen Inc. (NXY). The deal closed more than seven
months after the biggest Chinese foreign takeover was
announced.
Now, Nexen will operate as a wholly owned subsidiary of CNOOC with
Kevin Reinhart remaining as chief executive. Nexen shares will be
delisted from the Toronto Stock Exchange after a few trading days.
Shares of the Canadian energy producer will cease trading on the
New York Stock Exchange before markets open on Feb 26, and will be
delisted consequently. All of Nexen’s existing assets, including
CNOOC's North and Central American operations, will be controlled
from Nexen's Calgary headquarters.
The acquisition agreement, first announced in Jul 2012, won
approval from the Committee on Foreign Investment in the United
States (CFIUS) earlier this month and from the Canadian regulators
in Dec 2012.
This deal marks a significant milestone for CNOOC as it gets hold
of Nexen’s biggest reserves in the Canadian oil sands. Nexen
operates in western Canada, the Gulf of Mexico, North Sea, Africa
and the Middle East. Apart from oil sands, Nexen remains dynamic in
natural gas exploration in shale rock formations. It owns
approximately 300,000 acres of shale-gas blocks in the Horn River
Basin in British Columbia.
Chinese energy giants remain busy now-a-days in stretching their
foothold to the international energy markets with the specific aim
of meeting domestic demand. As the world's second-largest economy,
China has a huge energy requirement.
In this connection, it is worth mentioning that China
Petroleum & Chemical Corp/Sinopec (SNP) has inked a
$1.02 billion deal with Chesapeake Energy Corp.
(CHK). This gives the second-largest Chinese energy producer 50%
share in 850,000 acres in the Mississippi Lime play in northern
Oklahoma.
CNOOC currently retains a Zacks Rank #3 (short-term Hold
rating).
CNOOC LTD ADR (CEO): Free Stock Analysis Report
CHESAPEAKE ENGY (CHK): Free Stock Analysis Report
NEXEN INC (NXY): Free Stock Analysis Report
CHINA PETRO&CHM (SNP): Free Stock Analysis Report
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