Log in
Forgot password ?
Become a member for free
Sign up
Sign up
Dynamic quotes 

4-Traders Homepage  >  News


Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesHot NewsMost Read NewsRecomm.Business LeadersCalendar 
The feature you requested does not exist. However, we suggest the following feature:

CNOOC : China's Cnooc Trims Its Exposure in Canadian North

share with twitter share with LinkedIn share with facebook
share via e-mail
10/26/2016 | 09:15pm CEST

CALGARY, Alberta-China's Cnooc Ltd. sold off its majority stake last month in a small Canadian oil and gas venture, according to an executive in the company, a sign the state-controlled energy giant is retrenching after spending billions to establish a foothold in the North American market.

Five years after buying 60% of Northern Cross (Yukon) Ltd., a privately-held firm with exploration leases in a remote area of the Canadian north, the Chinese company sold its stake to Canadian investors who held minority shares, the Calgary-based company's president said.

The move comes as Cnooc struggles to deal with a slump in global oil prices and a troubled $15 billion investment in Canada's oil sands, one of China Inc.'s largest overseas investments ever. In July, the company's local subsidiary, Nexen Energy ULC, said it was reviewing the long-term viability of its operations after accidents at two key oil sands facilities that slashed production.

Richard Wyman, Northern Cross's president, declined in an interview to disclose the value of the deal. "We're now a wholly Canadian-owned company," he said.

Representatives for Cnooc in Beijing and Nexen in Calgary had no immediate comment.

China's state-owned oil companies have been hit hard by sinking prices for crude oil and weak demand for refined oil products. In August, Cnooc reported a 7.7 billion yuan ($1.1 billion) net loss for the first half of the year, compared with a 14.7 billion yuan net profit in the first six months of 2015, in part due to a large write-down on asset valuations in Canada and elsewhere.

Like the Chinese energy giant's other investments in Canada, the $100 million Yukon drilling program has faced a series of roadblocks that have slowed the path toward profitability.

Northern Cross is seeking to drill test wells in Yukon Territory, which currently produces no oil and natural gas. The company, which was set up in 1994, wants to tap into an estimated trillions of cubic feet of gas and millions of barrels of oil trapped under the permafrost in one of the last unexplored frontiers for energy development.

The project could allow Northern Cross to supply all of Yukon's small consumption volumes and possibly export natural gas and oil to foreign markets, such as China. That attracted interest from Cnooc, which bought its stake in June of 2011, a precursor to more ambitious investments in Canada over the following two years.

But Northern Cross hasn't been able to secure needed government approval in the face of strong opposition from environmental groups. The fate of the project, which is currently in limbo awaiting permitting, may hang on the outcome of a federal court ruling expected early next year.

Northern Cross filed suit against the Yukon Environmental and Socio-Economic Assessment Board in March a month after the territorial regulator said it couldn't make a decision on the company's plan to drill 20 test wells due to concerns about the potential impact on migratory caribou. The company wants to force the board to make a decision based on available data, which it hopes will allow it to move forward with the test drilling program, Mr. Wyman said.

"There's a lot of balls in the air and I'm not sure how they're all going to land. But it's not exactly the most business-friendly environment, I can tell you that," he said.

Brian Spegele contributed to this article.

Write to Chester Dawson at chester.dawson@wsj.com

share with twitter share with LinkedIn share with facebook
share via e-mail
Latest news
Date Title
09:15pDJCNOOC : China's Cnooc Trims Its Exposure in Canadian North
09:15p Global I/O Modules Market in Discrete Industries to Witness Growth Through 2020, Owing to Reduction in Prices of Raw Materials, Reports Technavio
09:14p GLOBAL AIR SAMPLER MARKET 2016 : Sigma, Horiba, TSI, Endress Hauser, Thermo Fisher, Casella, HI-Q, Emtek
09:14p AT&T : Disadvantaged Students Get Life-Changing Work Experience With Top Bay Area Employers
09:14pDJU.S. Cattle Futures Advance as Cash Prices Soar on Strong Demand
09:12p BOEING : sees cash growth even if sales, production slow
09:11p GLOBAL AGRICULTURE EQUIPMENT MARKET 2016 : AGCO, Kverneland, John Deere, CNH, JL Farm Equipment, Farmers Equipment, Grimme, Rabe, Monosem
09:11p FS ENERGY & POWER FUND : Results of Operations and Financial Condition (form 8-K)
09:11p IBI : » IBI Group Inc. Announces Completion of Partial Redemption of 6.00% Convertible Unsecured Subordinated Debentures Due June 30, 2018
Latest news
Hot News 
7.75%KERING : shares at 15-year high as Gucci turnaround impresses
-13.74%LWPartners says Dycom shares can double or triple
-10.23%CHIPOTLE MEXICAN GRILL : quarterly restaurant sales down more than expected
-11.11%GRUBHUB : Profit Soars
3.43%Mondelez Results Top Expectations; Food Company Raises Its Guidance
Most Read News
10/25 SAMSUNG ELECTRONICS : Apple's holiday surprise - big sales, not so big profits
05:17a Bumpy switch to new models hits Airbus Group's third-quarter profits
10/25 APPLE : For Apple, surprise hunger for big phones leaves money on table
10:30a TSX falls as earnings misses, oil price fall weigh
03:13a TOYOTA MOTOR : to recall 5.8 million cars in Japan, China, Europe over Takata airbags
Most recommended articles
08:15aDJS&P 500, Nasdaq Futures -- Technical Analysis
10/25 DEUTSCHE BANK : Schaeuble says monetary policy has reached its limits
10/25 APPLE : Gadgets in decline as R&D shifts to software and services - study
10/24DJGold Prices Turn Lower Amid Strong Economic Data