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China’s largest offshore oil producer, CNOOC Ltd. (CEO - Analyst Report), announced today that it has finally wrapped up the $15.1 billion acquisition of Canada’s Nexen Inc. . The deal closed more than seven months after the biggest Chinese foreign takeover was announced.

Now, Nexen will operate as a wholly owned subsidiary of CNOOC with Kevin Reinhart remaining as chief executive. Nexen shares will be delisted from the Toronto Stock Exchange after a few trading days. Shares of the Canadian energy producer will cease trading on the New York Stock Exchange before markets open on Feb 26, and will be delisted consequently. All of Nexen’s existing assets, including CNOOC's North and Central American operations, will be controlled from Nexen's Calgary headquarters.

The acquisition agreement, first announced in Jul 2012, won approval from the Committee on Foreign Investment in the United States (CFIUS) earlier this month and from the Canadian regulators in Dec 2012.

This deal marks a significant milestone for CNOOC as it gets hold of Nexen’s biggest reserves in the Canadian oil sands. Nexen operates in western Canada, the Gulf of Mexico, North Sea, Africa and the Middle East. Apart from oil sands, Nexen remains dynamic in natural gas exploration in shale rock formations. It owns approximately 300,000 acres of shale-gas blocks in the Horn River Basin in British Columbia.

Chinese energy giants remain busy now-a-days in stretching their foothold to the international energy markets with the specific aim of meeting domestic demand. As the world's second-largest economy, China has a huge energy requirement.

In this connection, it is worth mentioning that China Petroleum & Chemical Corp/Sinopec (SNP - Analyst Report) has inked a $1.02 billion deal with Chesapeake Energy Corp. (CHK - Analyst Report). This gives the second-largest Chinese energy producer 50% share in 850,000 acres in the Mississippi Lime play in northern Oklahoma.

CNOOC currently retains a Zacks Rank #3 (short-term Hold rating).

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