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|Ben Geman||August 7th 2012|
Sen. James Inhofe (R-Okla.), citing national security concerns, is questioning a Chinese oil company’s planned purchase of the Canadian energy firm Nexen Inc., which holds substantial Gulf of Mexico oil-and-gas assets. Inhofe joins a pair of senior Democrats – Sen. Chuck Schumer (N.Y.) and Rep. Ed Markey (Mass.) – in questioning state-owned CNOOC Ltd.’s proposed $15.1 billion purchase of Nexen.
“I have serious national security concerns with the Chinese government, acting through one of its corporations, purchasing a company that will give it control over significant U.S. oil and gas resources,” Inhofe told MarketWatch in a statement. “This combined with China’s closed economy, its prohibition on direct, full investment in Chinese business operations by U.S. firms, and its blatant disregard to U.S. intellectual property rights make this transaction even more concerning,” adds Inhofe, who is a senior member of the Armed Services Committee.
The Oklahoma Republican’s comments follow a late July letter about the CNOOC-Nexen deal from Schumer to Treasury Secretary Timothy Geithner, whose department heads the interagency panel that reviews foreign purchases of U.S. assets that could affect national security. Schumer similarly criticized China for failing to provide U.S. businesses access to its markets, and said Treasury should “withhold approval of this transaction until China's government has made tangible, enforceable commitments to ensure U.S. companies reciprocal treatment.” Markey, in a separate letter to Geithner, called for action to ensure payment of Gulf of Mexico royalties from leases that currently allow royalty-free oil-and-gas production.
Another Republican, Sen. John Hoeven (R-N.D.), said in late July that he has “concerns” about the CNOOC-Nexen deal. Hoeven and other advocates of the proposed Keystone XL pipeline have cited the planned purchase of Nexen – which is a significant player in the Canadian oil sands – in calling for Obama administration approval of the pipeline.
TransCanada Corp.’s proposed pipeline would bring Canadian oil sands to Gulf Coast refineries.
Ben Geman writes for The Hill, from where this article is adapted.