CNOOC bid to takeover Canadian oil company Nexen faces strong opposition
Big News Network.com Thursday 4th October, 2012
OTTAWA - The federal New Democratic Party (NDP), the main opposition, has strongly opposed China National Offshore Oil Corporation (CNOOC) bid to take over Calgary based oil and gas company Nexen, charging that the process lacked transparency and left many questions unanswered.
Peter Julian, the energy and natural resources critic for the official opposition NDP, told a news conference on Thursday that his party does not have confidence in the Conservative government's ability to handle the $15.1-billion transaction in a transparent fashion.
New Democrats "cannot support the rubber-stamping of the CNOOC takeover of Nexen," said Julian. "We cannot see the net benefit when we look at a variety of concerns and criteria that have been raised by the Canadian public."
Voicing similar concerns, industry critic Hlne Leblanc said the process hasn't been transparent, and there are too many unanswered questions.
The proposed takeover is worth C$15.1 billion, triggering a review under the Investment Canada Act.
It is currently under a 45-day review by Industry Canada that ends Oct. 12, but Ottawa could extend the process deadline by another 30 days.
The opposition in Canada comes as U.S. officials are also reviewing the proposal because of Nexen holdings in that country.
The trigger for the concern is the Chinese state-owned company getting ownership of the oilsands. CNOOC is being seen as a "strategic arm" of the Chinese government, which has been pushing companies to acquire assets overseas particularly in the quest for greater access to energy and mineral resources.
Julian said the concerns included the environmental and human-rights record of CNOOC, the potential for job losses and the departure of the company's head office in Calgary, and risks to national security.
"The idea that this government would enforce conditions is simply a smoke screen," he said.
"Every single takeover that has been rubber-stamped by this government, regardless of whether the companies have maintained their commitments or not the government has never responded to enforce those conditions."
Earlier this week, NDP had sought to pass a motion that would have required the government to hold parliamentary committee hearings on the bid but the move was blocked by the majority Conservative government.
The NDP had, until Thursday, been building a case against the deal by talking with Canadians in the oil patch and business community as well as labour groups.
Federal opposition parties want the government to refer the matter to a parliamentary committee.
They also want a debate on the House of Commons on the Canada-China Foreign Investment Promotion and Protection Agreement (FIPPA) which will allow companies operating in either country to sue host governments for allegedly discriminatory measures.
Canadian and Chinese negotiators have laboured for years to conclude the FIPPA deal, which however is not as sweeping as the North American free-trade agreement or the deal being sought with the European Union.
Prime Minister Stephen Harper signaled the bilateral agreement was essentially concluded when he visited China in February, and then signed the deal in July during a meeting with Chinese President Hu Jintao at a summit in Vladivostok, Russia.
The government tabled it in the House of Commons last week, and it will come into force after 21 parliamentary sitting days.