CNOOC Ltd. to acquire Nexen Inc. for $15.1 billion

By OGJ editors

CNOOC Ltd. will acquire Nexen Inc., Calgary, for $15.1 billion as China expands its holdings in worldwide exploration and production operations.

CNOOC said the definitive agreement represents a 61% premium to Nexen’s common share closing price on July 20, 2012. It said the deal “provides significant long-term benefits to Canada” and has the unanimous approval of the boards of both companies. Shareholder approval will be sought on Sept. 21.

Nexen averaged production of 207,000 b/d of oil equivalent after royalties in the quarter ended June 30 and had 900 million boe of proved reserves and 1.122 billion boe of probable reserves at end of 2011. It also had best estimate contingent resources of 5.6 billion boe, mainly in Canadian oil sands.

CNOOC noted that Nexen’s assets, which will expands its own global offshore footprint, are mainly in  Western Canada, the UK North Sea, the Gulf of Mexico, and offshore Nigeria. Nexen is focused on conventional oil and gas, oil sands, and shale gas.

Nexen management’s current mandate will be expanded to include all of CNOOC’s North American and Caribbean assets.

CNOOC had net production of 909,000 boe/d at the end of 2011 and net proved reserves of 3.19 billion boe.

CNOOC said the transaction establishes Calgary as its North and Central American headquarters that will manage Nexen’s global operations and CNOOC’s $8 billion of existing operations in the region.

Nexen’s management and employees will be retained and its capital spending will be enhanced, CNOOC said. Nexen’s $4.3 billion in current debt will remain outstanding.

CNOOC noted that it has been a large investor in Canada since 2005, having spent $2.8 billion (Can.). The investments include stakes in MEG Energy Inc., OPTI Canada Inc., and a 60% interest in Northern Cross (Yukon) Ltd. OPTI Canada is Nexen’s partner in the Long Lake steam assisted gravity drainage production facilities.

Nexen’s assets in the UK, US, and other countries will continue to be managed from its regional offices, and CNOOC will retain the current management and employees in those operations as well as continue to work with local suppliers.

CNOOC said it is committed to Nexen’s assets in the UK and will maintain its operations in the US Gulf of Mexico and offshore Nigeria.

Related Articles

Encana plans to hit the ground running in Permian

12/12/2014 Encana Corp. has announced its second major acquisition in a Texas oil play this year, agreeing in September to acquire Permian basin-focused produ...

Linn sells down Permian position

12/12/2014 Linn Energy LLC, of Houston, has agreed to sell assets in Ector and Midland counties, Tex., to Fleur de Lis Energy LLC, of Dallas, for $350 million.

Linn exits Anadarko basin in deal worth $1.95 billion

12/12/2014 Linn Energy LLC has agreed to sell all of its oil and gas properties and related midstream assets in the western Anadarko basin for $1.95 billion t...

Eagle Ford sweet spots still profitable

12/12/2014 The average Eagle Ford well remains viable with US light, sweet crude prices at $80/bbl, but the economics of some wells outside the play's sweet s...

Southwestern makes $5.4 billion bet on Marcellus

12/12/2014 Southwestern Energy Co. is purchasing Appalachian assets from Chesapeake Energy Corp. in a deal that more than doubles its leasehold in the Marcell...

Keyera to take majority interest in Alberta gas plant

12/12/2014 Keyera Corp., Calgary, will pay $65 million (Can.) to buy a 70.79% ownership interest in the Ricinus deep-cut gas plant in west-central Alberta.

WoodMac: US unconventional enters new stage

12/12/2014 The unconventional oil and gas revolution is entering into a new stage with drilling and completion techniques pioneered in unconventional plays no...

Canada Briefs

12/12/2014

PBF Energy, PBF Logistics make management changes

12/12/2014 Matthew Lucey, currently executive vice-president of PBF Energy Inc., will succeed Michael Gayda as the company’s president. Todd O’Malley, current...

White Papers

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...

Accurate Thermo-Fluid Simulation in Real Time Environments

The crux of any task undertaken in System Level Thermo-Fluid Analysis is striking a balance between ti...

6 ways for Energy, Chemical and Oil and Gas Companies to Avert the Impending Workforce Crisis

As many as half of the skilled workers in energy, chemical and oil & gas industries are quickly he...
Sponsored by

AVEVA NET Accesses and Manages the Digital Asset

Global demand for new process plants, power plants and infrastructure is increasing steadily with the ...
Sponsored by

AVEVA’s Approach for the Digital Asset

To meet the requirements for leaner project execution and more efficient operations while transferring...
Sponsored by

Diversification - the technology aspects

In tough times, businesses seek to diversify into adjacent markets or to apply their skills and resour...
Sponsored by

Engineering & Design for Lean Construction

Modern marketing rhetoric claims that, in order to cut out expensive costs and reduce risks during the...
Sponsored by

Object Lessons - Why control of engineering design at the object level is essential for efficient project execution

Whatever the task, there is usually only one way to do it right and many more to do it wrong. In the c...
Sponsored by

Available Webcasts



The Future of US Refining

When Fri, Feb 6, 2015

Oil & Gas Journal’s Feb. 6, 2015, webcast will focus on the future of US refining as various forces this year conspire to pull the industry in different directions. Lower oil prices generally reduce feedstock costs, but they have also lowered refiners’ returns, as 2015 begins with refined products priced at lows not seen in years. If lower per-barrel crude prices dampen production of lighter crudes among shale plays, what will happen to refiners’ plans to export more barrels of lighter crudes? And as always, refiners will be affected by government regulations, particularly those that suppress demand, increase costs, or limit access to markets or supply.

register:WEBCAST


Oil & Gas Journal’s Forecast & Review/Worldwide Pipeline Construction 2015

When Fri, Jan 30, 2015

The  Forecast & Review/Worldwide Pipeline Construction 2015 Webcast will address Oil & Gas Journal’s outlooks for the oil market and pipeline construction in a year of turbulence. Based on two annual special reports, the webcast will be presented by OGJ Editor Bob Tippee and OGJ Managing Editor-Technology Chris Smith.
The Forecast & Review portion of the webcast will identify forces underlying the collapse in crude oil prices and assess prospects for changes essential to recovery—all in the context of geopolitical pressures buffeting the market.

register:WEBCAST



On Demand

Optimizing your asset management practices to mitigate the effects of a down market

Thu, Dec 11, 2014

The oil and gas market is in constant flux, and as the price of BOE (Barrel of Oil Equivalent) goes down it is increasingly important to optimize your asset management strategy to stay afloat.  Attend this webinar to learn how developing a solid asset management plan can help your company mitigate costs in any market.

register:WEBCAST


Parylene Conformal Coatings for the Oil & Gas Industry

Thu, Nov 20, 2014

In this concise 30-minute webinar, participants have an opportunity to learn more about how Parylene coatings are applied, their features, and the value they add to devices and components.

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected