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Canadian government will consider public opinion in Cnooc-Nexen decision

BY PAUL VIERIA

OTTAWA -- Canada' s Conservative government will take public opinion into account when reviewing foreign takeovers, including China-owned Cnooc bid for Canadian energy company Nexen, the country' s resources minister said.

"This is a democracy," Joe Oliver said following the conclusion of the weekly Conservative Party caucus meeting, when asked if polling might be influencing the government' s review of Cnooc' s proposed deal. "The government takes into account the opinions of Canadians."

Under Canadian law, any foreign investment over $332.4 million is scrutinized by government officials to ensure the transaction, as structured, would provide a net benefit to the economy. Among the factors government officials eye are pledges on job creation and capital investment.

A Canadian government decision could emerge on the Cnooc and Nexen deal in early to mid November, though it has the option to extend its review.

Recent polls suggest Canadians have concerns about the deal. Ottawa based Abacus Data said a poll conducted in mid-September indicated over two-thirds of Canadians wanted the federal government to block the Cnooc and Nexen transaction. And this month, Angus Reid Public Opinion said 58% of respondents to an online survey opposed Cnooc' s planned purchase, and 47% said state-owned enterprises shouldn' t be allowed to control resources on Canadian soil.

Cnooc is a state owned enterpise, and its proposed bid has sparked a political debate in Canada about how much influence such firms should play in the Canadian economy, especially in the resources sector. Canadian policymakers stunned markets when Canada announced late last Friday that it had rejected a deal in which Malaysia' s Petroliam Nasional, another state owned enterprise, would acquire Canadian natural gas producer Progress Energy.

Canadian Prime Minister Stephen Harper has said the Petronas deal didn' t represent a net benefit to the Canadian economy, but Petronas had 30 days to respond and satisfy government concerns. He added his government plans to release new guidelines on foreign takeovers, including elements that would govern state owned enterprises.

Dow Jones Newswires

10/25/2012

 

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