US congressman says no legal power to stop China-Canada oil deal

Wed Jul 25, 2012 7:44pm EDT

* Rep. Forbes: CNOOC-Nexen will take energy U.S. could have used

* Blames Obama for delaying pipeline from Canada

By Roberta Rampton

WASHINGTON, July 25 (Reuters) - Congressman Randy Forbes, a Republican who has been wary of China's military and economic power, said he is alarmed by a bid by China's state oil company CNOOC for Canadian oil company Nexen.

But Forbes said there is not much he can do about it.

"Whatever we would do would simply be talking in the wind, because we don't have any legal authority to stop this action," Forbes told Reuters.

In 2005, Forbes, co-founder of the 42-member Congressional China Caucus, spearheaded congressional opposition to CNOOC's failed takeover of energy company Unocal.

In his view, the CNOOC-Nexen deal would seal up Canadian energy resources that the United States could use, and give China access to offshore drilling leases in the Gulf of Mexico.

"We're allowing China to be right off our coast, essentially, taking energy and fuel that we could have been having and using for domestic use here in the United States," Forbes said.

"More than a foot in the door, this is a body in the door for the Chinese in the North American energy market, and it's one that came about because of U.S. procrastination and a lack of diligence," he said.

Forbes blames the deal on President Barack Obama because of his decision in January to delay approval of the Keystone XL pipeline, a project designed to carry crude from Canadian oilsands to Texas refineries.

Obama said a portion of the pipeline going through Nebraska needed more environmental review after the route was adjusted to avoid an ecologically sensitive area. The State Department is currently studying the project.

"Once the Keystone pipeline was rejected by this administration, the Canadians began looking to China," Forbes said.

Republican Senators David Vitter and John Hoeven have voiced similar criticisms. They and other Republican Senate leaders will unveil energy legislation on Thursday designed to highlight their energy proposals ahead of the November presidential election.

Forbes said the Obama administration should immediately approve the pipeline to "show the Canadians that they have another option other than having to deal with the Chinese in this particular situation."

Unlike CNOOC's 2005 proposal to take over Unocal, which prompted a political firestorm on Capitol Hill, Forbes said he does not expect the Nexen tie-up to create much controversy.

"We had the right then to take action and stop that," he said. "In this particular situation, it's a Canadian company, so we don't have the same rights that we did in 2005.

"We could pass the standard customary resolutions, but they don't do anything but go in the trash cans," he said.

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Comments (1)
Hardykho wrote:
Why don’t you overbid the China company to get Nexen. End of the story instead of whining.

Jul 25, 2012 8:20pm EDT  --  Report as abuse
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