CNOOC (Chinese) to Buy Nexen

[wookster]

The "Daily Oil bulletin" reports that they plan on keeping Calgary as there head office for North America and the Caribbean, and Calgary would still manage all of Nexen's current oversea's operations. They also said that they plan on retaining all current employee's and management and will apply for a TSX listing. Sounds ok for the workforce anyway.

[albertGQ]

What they say isn't always what they do.

When Resmor got purchased by MCAP recently, they said they weren't going to lay anyone off. That didn't happen.
Employers don't want a mass exit of their current employees

[shermanator]

My father works for Nexen, so I wonder how this affects them? They just moved their US ops from Dallas to Houston and he just finished the move.

[TurnedTheCorner]

My former employer. Interesting. Whenever purchase talks came up in the bast, Total was always named as a player. It'll be interesting to see how this unfolds.

[malcolmk14]

Im sure itll be an interesting few months for my friends and family, i worked for nexen for five years ending april 2012, my dad has worked for them for 9 years, and my girlfriend has been there in a new grad engineering role for a few months.

[Azure]

So if they want a head office in Calgary to oversee all North American and South America operations, would they expand their current workforce? Headquarters are already in Calgary as is.

[Regorium]

Originally Posted by SeeGeeWhy

When someone says its not fair that the Chinese are able/allowed to do this, that they don't play by the same rules. That is a load of crap. If, for example, Exxon had the financial resources that the Chinese have, you can be assured they would probably as agressive or even moreso in their acquisitions. Its not just financial resources, its human resources they have. They employ millions of people in those three companies, it is just insane... Are those people suggesting that the Rockefeller run Standard Oil shouldn't have been busted up as a monopoly so they could have been more integrated with government than they already are and been able to "compete" in a "more fair" fashion with the likes of other foreign governments? I don't know... our culture and government needs to do what works for us, and have to understand that other places will do things differently. Not everyone can or should be the same.

Wait, I don't really understand your point here. Isn't the whole point that Exxon DOESN'T have the resources because of our regulations against monopoly? I mean, I agree with you that if Exxon was as big as CNOOC and left unchecked, they'd be absorbing companies left and right, but the main point is that they can't do that.

The chinese governmental companies, on the other hand, are allowed to do that. This means that they're not playing by the same rules. It's just fact, not "a load of crap".

Finally, while I would argue against monopoly, I would also argue against foreign government companies (monopolies in their own countries) being allowed to take over all of our domestic companies, and their assets/natural resources. I'm not smart enough to reconcile the two and provide a solution, but I hope you see my point. Perhaps if our "way" and our "culture" ends up with us getting swallowed up by foreign companies, we should rethink it before it's too late.

[MotoRacer]

There will be even more pho shops?

[AMG_G]

Originally Posted by MotoRacer

There will be even more pho shops?

Pho is Vietnamese.

[sevenarms]

Originally Posted by AMG_G

Pho is Vietnamese.

He meant sushi.

[Stay Golden]

We all know China is massively over populated and strained for all resources. Canada should be continuing to sell that service at a premium instead of selling the ownership of the actual resource itself.
This is the foot in the door that China has desperately wanted. China has minority stakes in a handful of Canadian energy exploration companies but this is sole ownership.
CNOOC will now own and control Oilsands sites and where Nexen is abroad like Columbia, the North Sea, UK, Poland, Nigeria.
This is not good, the feds need to wake up out of their summer slumber and axe the deal. Selling the resources outright, how foolish for Canada meanwhile a Lottery ticket win for a handful of sellouts. JMO.

[Senator Clay Davis]

For whatever reason, I think the Feds will reject this deal. Just a gut feeling. And they should too. Canadian companies coming under the control of foreign governments isn't a good thing.

[Suave]

Originally Posted by Stay Golden

We all know China is massively over populated and strained for all resources. Canada should be continuing to sell that service at a premium instead of selling the ownership of the actual resource itself.
This is the foot in the door that China has desperately wanted. China has minority stakes in a handful of Canadian energy exploration companies but this is sole ownership.
CNOOC will now own and control Oilsands sites and where Nexen is abroad like Columbia, the North Sea, UK, Poland, Nigeria.
This is not good, the feds need to wake up out of their summer slumber and axe the deal. Selling the resources outright, how foolish for Canada meanwhile a Lottery ticket win for a handful of sellouts. JMO.

Why is this not good, don't Canadian companies do the exact same thing in other countries? Look at Nexen, only a small portion of its production is even in Canada.

Sure this is a state owned company but they have to pay royalties, taxes and apply for licensing same as any other corporation trying to develop resources in Canada. If anything having that kind of financial backing will allow to develop properties even during the "bust" times, which might lessen the blow when prices drop.

[Stay Golden]

Originally Posted by Suave

Why is this not good, don't Canadian companies do the exact same thing in other countries? Look at Nexen, only a small portion of its production is even in Canada.

Sure this is a state owned company but they have to pay royalties, taxes and apply for licensing same as any other corporation trying to develop resources in Canada. If anything having that kind of financial backing will allow to develop properties even during the "bust" times, which might lessen the blow when prices drop.

You don't sell ownership of your resources period. If other countries are foolish enough to do that, its on them. You maintain majority control of what are your borders resources.

Once China has the ownership of the resources they can distribute it however they want to and they will.

Simple example of ownership lease economics look no further than the Stampede board, they will retain the ownership of all their land for as long as possible. Their land is their most valuable resource.

The ownership of the energy exploration and ditribution is Nexen's raw value. If you don't think that Nexen has major rights in the Oilsands.
Drive up and see for yourself.
Long Lake, Kinosis, Hangingstone and 7% interest of Syncrude which alone provides Nexen 350,000 of capacity b/d
Nexen owns about 300,000-320,000 acres in the Oilsands.
There are other sites that Nexen has not developed that they have land holdings like Meadow Creek, Cottonwood, Leismer etc.
Far from small production and the future potential.
The Feds need to axe this deal and quickly.

[zuluking]

Originally Posted by Stay Golden

You don't sell ownership of your resources period. If other countries are foolish enough to do that, its on them. You maintain majority control of what are your borders resources.

Once China has the ownership of the resources they can distribute it however they want to and they will.

Simple example of ownership lease economics look no further than the Stampede board, they will retain the ownership of all their land for as long as possible. Their land is their most valuable resource.

The ownership of the energy exploration and ditribution is Nexen's raw value. If you don't think that Nexen has major rights in the Oilsands.
Drive up and see for yourself.
Long Lake, Kinosis, Hangingstone and 7% interest of Syncrude which alone provides Nexen 350,000 of capacity b/d
Nexen owns about 300,000-320,000 acres in the Oilsands.
There are other sites that Nexen has not developed that they have land holdings like Meadow Creek, Cottonwood, Leismer etc.
Far from small production and the future potential.
The Feds need to axe this deal and quickly.

What about Shell, Statoil, Total, BP, etc? At the least Shell is operating solo in the oil sands; at most, all of them are (not sure.) Shell Canada operated as a separate organization (and separately traded, if I recall) and Royal Dutch bought them out a few years ago. This was not blocked by the feds. What is the basis of them blocking this sale then?

(I haven't formulated an opinion yet, but I'm just interested in how you view the precedents...if valid.)

[Suave]

But there are already lots of foreign state owned resource companies operating in Canada. Should they all be not allowed to operate as well?

And isn't the whole point of the Gateway and Coast Gaslink pipelines to sell these resources to the Chinese? So other companies are free to chose who they sell the resources to but not a state owned one?

[Azure]

Interesting article here.

http://online.wsj.com/article/SB1000...googlenews_wsj

[Knalus]

Originally Posted by Stay Golden

You don't sell ownership of your resources period. If other countries are foolish enough to do that, its on them. You maintain majority control of what are your borders resources.

Once China has the ownership of the resources they can distribute it however they want to and they will.

Simple example of ownership lease economics look no further than the Stampede board, they will retain the ownership of all their land for as long as possible. Their land is their most valuable resource.

The ownership of the energy exploration and ditribution is Nexen's raw value. If you don't think that Nexen has major rights in the Oilsands.
Drive up and see for yourself.
Long Lake, Kinosis, Hangingstone and 7% interest of Syncrude which alone provides Nexen 350,000 of capacity b/d
Nexen owns about 300,000-320,000 acres in the Oilsands.
There are other sites that Nexen has not developed that they have land holdings like Meadow Creek, Cottonwood, Leismer etc.
Far from small production and the future potential.
The Feds need to axe this deal and quickly.

Canada hasn't sold ownership of the resource. They sell leases and licenses.
And most of Canada's resource companies are owned by outsiders. Americans, Europeans, Arabs ect. all own oil and gas companies that operate in Canada. Even state owned companies. Canada still owns the land. That hasn't changed one iota. Canada still plays the role of the Stampede board, the Chinese are merely trying to be a business owner that leases from them. It is the best way to actually get value from your land without selling it.

To say no to this deal because of what you stated shows two things.

One: You don't know what the situation is currently. This is not unprecedented.

Two: You are scared of the Chinese specifically, and are singling them out for special treatment.


We treated the purchase of Harvest to the Korean national oil company different than we are treating this. Or how about the acquisition of three separate producing companiesby the Abu Dhabi National Energy Company aka Taqa? Why is it that we should single out the Chinese when we didn't single out the Arabs, or the Koreans?

Or perhaps you think that the Oilsands are a special case? Then why let a French, or British, or American firm own anything in the Oilsands? Because they do. In fact, if it weren't for these foreign firms, the Oilsands would not have been produced when they were. It took a while for Canadian firms to catch up with many of the foreign multi-nationals. Total, a French firm, is one of the biggest foreign producers in the oilsands. And they own the whole company.

This is just how the world works. Countries that try to block this kind of ownership aren't doing very well, whereas the ones that work together in partnership do.

Besides, you are looking at this the wrong way. If a large state owned Chinese company purchases large assets within your country, they are integrating themselves with you. This is a good thing. You don't purchase large controlling interests into a country you are being belligerent with, the likelihood of you loosing your entire investment is huge. Them doing business here is the best thing that can happen to Chinese-Canadian relations. It gives us a greater voice when dealing with China. It means that we are of value to them, in a real, and tangible way. Plus, it means that they are investing money into Canada, contributing to our growth and prosperity because they will benefit from it.

[Knalus]

Ironically, Nexen began as a subsidiary of an American Company.

http://en.wikipedia.org/wiki/Canadia...ompanies#Nexen

[Bring_Back_Shantz]

Originally Posted by Stay Golden

You don't sell ownership of your resources period. If other countries are foolish enough to do that, its on them. You maintain majority control of what are your borders resources.

Once China has the ownership of the resources they can distribute it however they want to and they will.

Simple example of ownership lease economics look no further than the Stampede board, they will retain the ownership of all their land for as long as possible. Their land is their most valuable resource.

The ownership of the energy exploration and ditribution is Nexen's raw value. If you don't think that Nexen has major rights in the Oilsands.
Drive up and see for yourself.
Long Lake, Kinosis, Hangingstone and 7% interest of Syncrude which alone provides Nexen 350,000 of capacity b/d
Nexen owns about 300,000-320,000 acres in the Oilsands.
There are other sites that Nexen has not developed that they have land holdings like Meadow Creek, Cottonwood, Leismer etc.
Far from small production and the future potential.
The Feds need to axe this deal and quickly.

I don't think you understand how resources are handled in Canada.
CNOOC is trying to buy Nexen, which holds leases to those resources.
How exactly is that different than any of the numerous other foreign companies that have leases all across this country?

Exxon, BP, Shell, Total, and nunerous others, all have pretty large operations in Canada even though they are foreign companies. Right now countries all over the world would be pretty excited about the prospect of some foreign investment.