Petronas deal scuttled- The precedent is set – same with Potash Corp- Retain ownership of our resources.
Consider that China does not offer any where near the same playing fields for Non Chinese companies
The Chinese are experts at delaying other Non Chinese companies that compete in China against Chinese Companies.
Point- approx 10 years ago oil production- 80 % was controlled by vaious Govts. From what I undertsand now that number has increased to 90 %-
Our Natural resources are a Strategic Resource –Should it Controlled by Other States -
CNOOC, Nexen deal: Will Ottawa take China at its word on takeover? | Energy | News | Financial Post
Why CNOOC’s Nexen acquisition should be nixed | Diane Francis | Financial Post
There are also two policy reasons to stop the global spree here.
1. Reciprocity. No entities from a foreign country should be allowed to do anything in Canada that Canadians cannot do in their country. In China’s case, this means only greenfields, or startups, can be invested in here and then with strict licensing from the government as is the case in China when building anything. No Chinese can buy stock on the TMX or own shares of a Canadian company, as is the case there unless special government permission is granted. Same applies to real estate.
2. State-owned enterprises and sovereign wealth funds from all countries must be banned from owning any corporations, real estate or resources in Canada. This is because they are agents of foreign jurisdictions and enjoy sovereign immunity.
Sinopec, for instance, has refused to appear in a Canadian court concerning dozens of outstanding charges against the company involving construction site malpractice that led to the deaths of two workers and injuries to four more in 2007 in Alberta. And this winter a Sinopec official said the company wants the Supreme Court of Canada to exempt it from such health and safety actions.
Once Nexen is nixed, the government of Canada should require full and timely disclosure of future foreign investment activities. Any ownership level beyond 5% should be disclosed quarterly and published immediately.
Nexen CNOOC Deal: Poll Finds 8 In 10 Don't Want Foreign Governments Owning Canadian Resources
8 in 10 Canadians against the deal
Nexen deal: Canada should be open for business, but not at any cost | Diane Francis | Financial Post
Canadians should be upset and insulted that China’s biggest grab for control of a major resource company anywhere in the world is the $15-billion Nexen deal. Clearly, China is testing whether this Boy Scout of a nation will roll over.
This is just one of many reasons why Canada must reject this takeover. Another is a warning by CSIS against foreign buyouts of strategic assets, and another is that polls show public opposition to the deal.
One compromise that’s been suggested is that the Nexen deal goes ahead but no more. That’s crazy. Canadians have no obligation to feed China’s appetite for resources just because it invited itself to dinner.
In addition, Canada has no obligation to Nexen shareholders, directors and management because they knew, or should have known, foreign transactions are always at the pleasure of Canadian governments.
Some common sense restrictions on any State Company buying our Natural Resources
1. The Chinese must be told this transaction is premature given that negotiations between Canada and China have just been announced to deepen the trading relationship and outline rules of engagement. This process will take years.
2. The buyer, CNOOC, should be told that it cannot buy control, but can own up to 20% of Nexen if it wishes. Foreigners taking small positions in transparent, Canadian-based public companies are not a problem.
3. The Chinese should be told the deal is premature because Canadians must have a national conversation about this. A Parliamentary committee, proposed by independent MP Peter Goldring, is a good idea and would study all the ramifications, and potential pitfalls, of allowing state-owned enterprises to invest and operate within Canada. Nexen will be studied as will Sinopec and the workplace accident that took place in Alberta three years ago and other cases.
This is why the collective holdings of China Inc.’s entities must be taken into consideration when determining whether a company has been taken over by a foreign entity. If five Chinese entities each own 20% of Syncrude that amounts to de facto control.
Similar concerns would be raised if Rosneft, Gazprom and other oligarchs, with licenses to operate from the Kremlin, were to collectively launch a buying spree in Canada. The same applies to companies like TAQA of Abu Dhabi and others who are ready to pounce here.