Nexen Inc announced today that its shareholders have approved the arrangement with CNOOC Limited and its purchase of Nexen outstanding common shares for $27.50 USD, a combined total of $15.1 billion USD.
Approved by 99 per cent of Nexen common shareholders and 87 per cent of Nexen preferred shareholder on Sept 20th, CNOOC’s interest in Nexen stems from a growth strategy of CNOOC’s presence in Canada, Nigeria and the Gulf of Mexico. This acquisition will also add CNOOC presence to the UK North Sea.
"The acquisition reflects our strong belief in Nexen's rich and diverse portfolio of assets and world-class management and employees. This is an exciting opportunity for us to build on our existing joint venture relationship with Nexen in Canada, and to acquire a leading international platform in the process. We strongly believe that this acquisition will create long-term value for CNOOC Limited's shareholders,” said Wan Yilin, Chairman of CNOOC Limited.
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CNOOC sees this acquisition as an answer to its efforts to produce long term sustainable growth. Nexen produced an average 207 mboe/d in Q2 of 2012 and had 900 mmboe of proved reserves as well as 1,122 mmboe of probably reserves as of Dec 31st, 2011.
This acquisition of Nexen by CNOOC provides benefits to Canada as well including the establishment of CNOOC Limited’s North and Central American headquarters in Calgary, CNOOC’s plan to retain Nexen’s current management team and employee, the enhancement of capital expenditures on Nexen’s assets, and the intention of listing CNOOC on the TSX.
The transaction, originally proposed June 23rd 2012, is still subject to the final order of the Court of Queen’s Bench of Alberta. Closure of this arrangement is expected in Q4 2012.