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Cnooc Gets Approved to Purchase Nexen for $1.5 Billion

Cnooc Ltd., China’s biggest offshore oil and natural gas producer, won approval to acquire the U.S. assets of Nexen Inc., its last regulatory hurdle in the $15.1 billion purchase of the Canadian energy company.

The Committee on Foreign Investment in the U.S. approved the deal, now expected to close the week of Feb. 25, Nexen said in a statement yesterday. The panel reviews takeovers by foreign-owned companies for national security implications. Cnooc’s acquisition of the Calgary-based company falls under U.S. jurisdiction because of Nexen’s Gulf of Mexico oil and gas operations, which account for about 8 percent of its output.

Cnooc’s acquisition, the biggest overseas purchase by a Chinese company, prompted changes in the way Canada reviews takeovers of oil sands operators by state-controlled companies. The Canadian government approved the deal in December, announcing at the same time that it would prohibit future state- owned acquisitions in the oil sands barring “exceptional circumstances.”

Investors have been betting on U.S. approval, Sam La Bell, an analyst at Veritas Investment Research in Toronto, said in a Feb. 11 phone interview. Nexen rose 2 percent to C$27.48 in Toronto yesterday, the highest price since June 2009. In U.S. trading, Nexen climbed to $27.43, 7 cents less than Cnooc’s offer of $27.50 a share. Markets in Hong Kong and China were closed today for holidays.

North Sea…”

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