China National Offshore Oil Corporation in acquisition of Nexen

Canada on Friday allowed a Chinese state-run oil giant to move forward with $15 billion takeover of a domestic energy company, but the government indicated that such deals might not pass muster in the future.
The deal - the acquisition of Nexen by the China National Offshore Oil Corporation, or Cnooc - is the latest effort by the Chinese government to find new sources of oil and natural gas reserves to helpdrive the country's growth.The state-run Cnooc has been active, striking severalpartnerships in Canada andthe United States.
Canada, in part, has welcomed the alliances.
Prime Minister Stephen Harper has been trying to create new markets to export Canadian energy, which is largely dependenton the United States for its exports. He has been courting China since the United States stalled approval of the Keystone XL pipeline project, which would move more oil sandsproduction to the Gulf Coast. On Friday, the governmentalso approved a $5 billion acquisition of Progress Energy Resources of Canada by Petronas, the Malaysian state-owned oil and gas company.
But the Nexen deal has also reignited the controversy over strategic assets ending up in the hands of foreign owners. Seven years ago, Cnooc gave up on an $18.5 billionbid for Unocal of the United States after political opposition. Two years ago, Sinochem, a Chinese chemicals maker, backed away from buying the Potash Corporation of Saskatchewan for similar reasons.
The Nexen bid prompted nationalistic concerns in Canada. Some conservative members of Parliament worried about Cnooc, which is an arm of the Chinese government, gaining control over energy assets generally controlled by Canadian provinces. Recognizing the sensitivity of the deal, Mr. Harper noted that foreign investment rules would be changed to block companies owned by foreign governments from acquiring properties in Alberta oil sands in all but"exceptional" circumstances.
"Canadians generally, and investors specifically, should understand that these decisions are not the beginning of a trend, but rather the end of a trend," Mr. Harper said at a news conference. "When we say that Canada is open for business, we do not mean that Canada is for sale to foreign governments."
It is not clear how the directive will play out on the deal-making front.

Total Sells Nigeria Oil Field to Sinopec for $2.5 Billion

Total SA (FP) , France ’s largest oil company, soldits 20 percent stake in anoffshore Nigerian field to China Petrochemical Corp. for about $2.5 billion as part of an asset-disposal program.
The OML 138 block includes the Usan field, which started output in February, Paris-based Total said today in a statement. The asset accounts for about 10 percent of Total’s Nigerianproduction, which averaged 287,000 barrels a day last year.
The sale is part of Total’s plans to complete $15 billion to $20 billion of asset disposals from 2012 to 2014. China’s state-backed energy companiesare seeking new oil and gas reserves abroad to feed the world’s second-largest economy, especially from regions like Africa where government scrutiny is lighter than in North America or Europe .
The sale of a minority stake in the Nigerian block is in line with Total’spolicy of actively managing its portfolio, Yves-Louis Darricarrere, head of exploration and production, said in today’sstatement.
The Usan field production, whose ramp up was slower than expected, could reach 140,000 barrels a day by the end of the year, Chief Financial Officer Patrick dela Chevardiere said in July. The French companyhad said it was expecting a peak rate of 180,000 barrels a day.
Total rose as much as 2 percent and was trading 70 cents higher at 37.67 euros as of 3:05 p.m. in Paris.
Total is also searching for abuyer for its southwesternFrench natural gas network known as TIGF. Current disposals could bring Total about halfway to its target, de la Chevardiere said last month.
Beijing-based Sinopec Group has also approached the French oilfirm Etablissements Maurelet Prom (MAU) , which operates in Gabon, about an acquisition, people familiar with the matter said this month.
Sinopec’s reserves of crude oil declined from 3.3 billion barrels in 2007 to 2.8 billion barrels at theend of last year, enough for nine years of production at 2011 levels,according to data compiled by Bloomberg. Its parent, China Petrochemical, said in January that it will seek toproduce 50 million metric tons of crude a year overseas by 2015. Last year, foreign production was 23 million tons.
The Nigerian National Petroleum Corp. is the OML 138 concession holder. Chevron Petroleum Nigeria Ltd. has30 percent, as does Esso E&P Nigeria (Offshore East) Ltd. Nexen Petroleum Nigeria Ltd. has20 percent.
To contact the reporter onthis story: Tara Patel in Paris at tpatel2@bloomberg.net

Oil giant BP has agreed to pay the largestcriminal penalty in U.S.

WASHINGTON Oil giant BP has agreed to pay the largestcriminal penalty in U.S. history for the 2010 oil spill in the Gulf of Mexico, a source close to the case confirmed to CBS News Thursday.
Attorney General Eric Holderis in New Orleans and is expected to announce the plea agreement at a press conference later Thursday, CBS News reports.
The largest previous corporate criminal penalty assessed by the Department of Justice was the $1.2 billionfine imposed on drug makerPfizer in 2009.
BP has booked provisions of$38.1 billion to cover its liabilities from the incident, but the company has said the final cost remained highly uncertain. BP also recently announced that it expects to make the final payment this year to a $20 billion trust fund to cover damage from the blowout.
The Deepwater Horizon rig, 50 miles off the Louisiana coast, sank after the April 20,2010, explosion that killed 11 people. The well on the sea floor spewed an estimated 206 million gallons of crude oil, soiling sensitive tidal estuaries and beaches, killing wildlife and shutting vast areas of the Gulf to commercial fishing.
BP Stirs Up U.S.- Brit Backlash

US will overtake Saudi Arabia as the world's biggest oil producer

The US will overtake Saudi Arabia as the world's biggestoil producer "by around 2020", an International Energy Agency (IEA) report has said.
The IEA said the reason for this was the big growth and development in the US of extracting oil from shale rock.
This has enabled the US to gain significantly more extractable oil resources.
As a result, the IEA predicts the US will become "all but self-sufficient" in its energy needs by around 2035.
The US shale oil industry hasgrown significantly in recent years.
It extracts oil from the ground using a method called fracking - pumping down a mixture of sand, water and chemicals at high pressure.
The industry says the method is safe, but critics sayit could cause earthquakes and pollute water sources.
The IEA predicts that the US will be producing 11.1 million barrels per day by 2020, compared with 10.6 million from Saudi Arabia.
Currently the US imports about 20% of its total energyneeds.
The IEA also expects that theUS will overtake Russia as theword's biggest gas producerby 2015, again thanks to fracking, which can also be used to extract natural gas.
It warns that the big growth in US oil and gas production could have significant geopolitical implications, as it may make the US less concerned about the MiddleEast.

Exxon shuts pipeline after oil leak offshore Nigeria

ABUJA (Reuters) - Exxon hasshut a pipeline off the coast of Nigeria 's Akwa Ibom state after an oil leak started by anunknown cause, the company's local unit said on Saturday.
The U.S. major's outage will add to production problems in Africa's biggest crude exporter, after fellow oil majors Shell and Eni reportedrecent disruptions at onshoresites due to Nigeria's worst flooding in 50 years.
"( Exxon Nigeria ) confirms that on November 9 an oil release occurred offshore Akwa Ibom State," Mobil Producing Nigeria , a joint venture between Exxon and the state oil firm, said in an emailed statement.
"The source of the leak was identified and the pipeline was isolated and shutdown."The company said it was investigating the cause of theleak but didn't give any details on the amount of oil production lost.
There was an oil spill in August near an Exxon facilitythat residents said left a slick running for miles along the coastline of Akwa Ibom. Exxon said it cleared up the spill but didn't confirm the source of the leak.
Italian oil firm Eni said on Friday it had declared force majeure on Brass River oil loadings from Nigeria due tofloods, which have submerged part of the southern oil-producing Niger Delta in recent weeks.
Flooding combined with oil theft, prompted Shell to declare force majeure on twoother large Nigerian oil streams, Bonny Light and Forcados, in late October.
Oil spills are common in Nigeria's onshore Niger Delta due to widespread theft by oil gangs tapping into pipelines and the poor maintenance of some ageing infrastructure.
But offshore spills are less common. Last December, an accident at Shell's offshore Bonga facility spilled an estimated 40,000 barrels, oneof the largest in Nigeria's history.
Nigerian regulators told parliament in July that Shell should be fined $5 billion for environmental damaged caused by the spill but the company has said there is nolegal basis for the fine.