* Canada reviewing CNOOC bid for oil producer Nexen
* Ottawa will look at security concerns while studying bid
* Canada PM says wants growing relationship with China
By Joe Penney
DAKAR, Oct 12 Canadian Prime Minister Stephen
Harper said on Friday that China's "very different" political
and economic systems are a concern as his government decides
whether to approve CNOOC Ltd's $15.1 billion bid for
oil producer Nexen Inc.
The comments were some of the most revealing Harper has made
in connection with the landmark CNOOC deal, which has raised
fears over Chinese state-owned enterprises buying up Canadian
Some members of Canada's governing Conservative Party are
wary of the CNOOC bid, in part because of what they say are
unfair Chinese business practices.
Harper - speaking to reporters in Dakar, Senegal - said
Canada wants a growing relationship with China, but added that
Chinese investments must be scrutinized from a national security
This week Ottawa hinted strongly that it would exclude
Chinese telecommunication equipment giant Huawei Technologies Co
Ltd from participating in the construction of a secure
Canadian government communications network because of security
Harper, asked about Huawei and the CNOOC takeover, began his
answer by saying he would not comment on any particular
transaction. But in his subsequent remarks he clearly touched
upon both cases.
"The relationship with China is important. At the same time
it's complex. It's complex because the Chinese obviously have
very different systems than we do, economic and political
systems, and that's why obviously some of these particular
transactions raise concerns," he told reporters in Senegal.
The Conservatives need to balance concerns over security and
an increased Chinese presence in Canada with their push to
attract more foreign investment for the Canadian resource
Ottawa says the oil and gas industry needs $650 billion
($663 billion) to fund new projects over the next decade alone,
and concedes that much of the money will have to come from
The Canadian government this week extended its review of
CNOOC's bid for Nexen by 30 days, to Nov. 11. Earlier it had
invoked a national security exemption that would allow it to
block Huawei from participation in its new telecoms network.
The extension, while expected, comes amid a growing furor
over alleged Chinese espionage in North America. Some Canadians
also fear that a successful CNOOC bid for Nexen could spark a
wave of mega takeovers of Canadian energy producers by foreign
"We will ensure as a government that we have not only a
growing relationship with China but a relationship with China
that is in Canada's best interests," Harper said.
"And of course ... there's a national security dimension to
this relationship, in fact to all our activities, that we take
very seriously," he added.
Ottawa says that at about the same time it announces a
verdict on the CNOOC bid, it will also unveil clearer guidelines
indicating the kind of foreign investment Canada wants.
The oil sands of the Western Canadian province of Alberta
are the world's third-largest oil deposit, and Nexen's portfolio
includes operations in the oil sands as well as shale assets in
the province of British Columbia and projects in other parts of
If approved, the CNOOC bid will be the biggest Chinese
takeover of a foreign company. The deal is being reviewed under
the Investment Canada Act, which allows the government to
examine whether a transaction is of "net benefit" to the
The government last blocked a foreign takeover deal in 2010
when it stunned markets by preventing Australia's BHP Billiton
Ltd from buying fertilizer maker Potash Corp.