BEIJING (Reuters) - CNOOC Ltd (0883.HK), China’s top offshore oil and gas producer, said on Friday it is confident of winning regulatory approval from Canada this year for its $15.1 billion bid for Nexen Inc NXY.TONXY.N.
State-controlled CNOOC launched China’s richest foreign takeover bid in July when it agreed to buy Nexen. But the success of its bid began to look shaky after Canada held up Malaysian state oil company Petronas’ $5.2 billion bid for Progress Energy Resources Corp (PRQ.TO).
Canada has extended its review for the CNOOC-Nexen deal by a month to December 10 to determine whether the takeover would bring a “net benefit” to the country.
CNOOC Chairman Wang Yilin said it was “normal” for the Canadian government to extend its review, adding that he expects the deal to be completed by year-end.
Wang was speaking to reporters on the sidelines of the Communist Party congress in Beijing.
Canada’s Prime Minister Stephen Harper said on Thursday that his government will make decisions very soon on foreign investment proposals it is considering and on the broader framework for dealing with such investments.
Nexen’s portfolio includes operations in oil sands and shale gas in the province of British Columbia, among assets around the globe.
Industry sources have said CNOOC’s bid might have a better chance of success compared to the Petronas deal as only about a quarter of Nexen’s assets are in Canada, while Progress Energy’s operations are centered in Canada.
CNOOC is pressing on in its search for overseas assets as it has only nine years worth of reserves based on current production levels - one of the lowest ratios among global oil majors.
Reporting by Charlie Zhu; Editing by Ryan Woo