By: Bob van der Valk
The Canadian government led by their Prime Minister Stephen Harper has softened their stance on China’s human rights record by giving a silent nod of approval to the China National Offshore Oil Corporation (Cnooc), the Chinese state oil company, making a bid for Canadian oil company Nexen. They will be investing in Canada’s vast tar sands crude oil reserves with China becoming a new market for Canadian oil sands around Alberta.
Currently nearly all of Canada’s crude oil is destined for export to the United States. President Obama intransigency by not approving the construction and operating permit for the complete route of the Keystone XL pipeline is coming back to bite the US in its proverbial behind. A takeover of Nexen by Cnooc will give the Chinese supplies of crude oil in the Gulf of Mexico, the North Sea and the off shore Nigeria.
The front of the White House sit-in by protesters against the Keystone XL pipeline in September 2011
In 2005 Unocal’s Board of Directors accepted a $17 billion takeover bid from ChevronTexaco passing up on a higher offer from Cnooc. US governmental approval on the deal became a heated political debate in Washington with this type of international merger requiring federal approval. ChevronTexaco was the white knight, who rode to the rescue of the Bush administration, when it looked like China would have a foot print on US soil with the crude oil reserves then owned by Unocal.
Canada will have the same type of public reaction with political parties fighting it out on whether to allow the Chinese to own a part of their sources of energy troves. China will finally have established a foot print on North American soil. The US Presidential election will have one more issue to talk about between now and November 6th.
Bob van der Valk is a petroleum industry analyst working and living in Terry, Montana. He can be contacted at (406) 853-4251 or e-mail: tridemoil@aol.com
His viewpoints about the petroleum industry are posted on his web page at: http://www.4vqp.com/pages/12/index.htm
