China's largest offshore oil and gas producer CNOOC has been disallowed to control oilfields in the Gulf of Mexico. This was a consequence of its US$15.1 billion purchase of Nexen Inc.
With the purchase of the Canadian firm, CNOOC has expanded its leasehold in the Gulf with an additional 200 deep water sources. These leases can produce nearly 205 million barrels of oil and is one of the largest in the region. These leases though must be surrendered because of US national security issues, according to two sources requesting anonymity.
CNOOC is being restricted by the US government as the investment is near military installations and the growing concern over Chinese initiated intellectual property theft and cyber attacks had red flagged the operations.
The central issue would be the transition of CNOOC from non-operator to operator. This would mean the owner would have operational decision making power on a project, a term which has become very important in terms of acquisition of technological means as well as access to proprietary information, both being national security concerns.
Join the Conversation