Nexen sale to China's CNOOC backed by Canada government

  • 7 December 2012
  • From the section Business
Media captionChina is making its biggest-ever energy acquisition through the purchase of Canadian oil company Nexen, Leisha Chi reports.

The Canadian government has approved the sale of oil company Nexen to state-owned Chinese firm CNOOC, but said it would likely block any such future takeovers.

Nexen shareholders approved the $15.1bn (£9.4bn) deal back in September, but it needed final backing from Ottawa.

The sale has proved controversial in Canada, amid concerns that it will give China too much influence over Canada's oil industry.

It is China's largest foreign takeover.

Canadian Prime Minister Stephen Harper said: "Foreign state control of oil sands development has reached the point at which further such foreign state control would not be of net benefit to Canada.

"Therefore, going forward, the minister [of industry] will find the acquisition of control of a Canadian oil sands business by a foreign state-owned enterprise to be of net benefit only in an exceptional circumstance."

In a separate announcement, the Canadian government also cleared the takeover of gas producer Progress Energy Resources by Malaysian firm Petronas for $5.5bn.

Canada has a large oil and gas industry, centred on the province of Alberta.

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