Life after CNOOC’s Nexen deal: Is China’s honeymoon with Canada’s oil patch over?

Janice Buckingham

Dec 7, 2013

Jeff Lewis, Claudia Cattaneo, Financial Post, National Post


After spending roughly $30-billion on Canadian oil and natural gas assets over the past six years, making it the largest foreign investor in Canadian energy, China is grappling with issues that have long plagued its North American rivals, including high costs, operational challenges, aboriginal issues and volatile bitumen prices.


Chinese companies across the board now seem focused on boosting cash flow. They are also accelerating investment in natural gas.


“To say that they’re not investing is not accurate, because they have acquired a tremendous amount of assets in this country,” said Janice Buckingham, a partner in the Calgary office of Osler, Hoskin & Harcourt LLP who handles asset deals involving SOEs.


Changes to the Investment Canada Act made by Ottawa put constraints on control of oil sands assets, but the tweaks ultimately went much further, alienating investors. An analysis by Osler lawyers said the rule changes introduced in last year’s federal budget give Ottawa more discretion over even minority purchases of energy assets by SOEs.


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