Chinese Oil Giant CNOOC Plans to Buy Canada’s Nexen

CNOOC, the Chinese offshore oil and gas giant, plans to buy Canadian producer Nexen, for $15.1 billion.

“This transaction will allow for significant investment in our business and opens the door to new opportunities for our employees,” Kevin Reinhart, interim CEO of Nexen, said in a statement.

The agreement is considered China’s biggest overseas energy acquisition and CNOOC expects the deal to be completed in the fourth quarter of this year, currently awaiting government’s approval. CNOOC and other important state-owned Chinese energy companies plan to focus their business on buying gas assets and oil in the Americas to reach resources useful to fuel China’s economy.

The two companies already had an agreement according to which CNOOC can make investments in Nexen offshore wells in the Gulf of Mexico. Nexen which operates in the Gulf of Mexico, Africa, western Canada, North Sea, and the Middle East, has its biggest reserves in Canadian oil sands. In the second quarter of this year the company produced an average of 213,000 barrels of oil.

“The acquisition reflects our strong belief in Nexen’s rich and diverse portfolio of assets and world-class management and employees,” CNOOC Chairman Wang Yilin said in a statement.