(EnergyAsia, June 29) — CNOOC Limited said it welcomes a US security review of its unsolicited US$18.5 billion bid for Unocal in response to growing political tensions generated by the Chinese company’s attempt to buy over one of America’s largest independent oil and gas companies.
Forty-one members of Congress supported by influential politicians in Washington have asked for a security review of the proposed takeover.
In a statement, CNOOC Limited’s chairman and CEO, Fu Chengyu, said: “In preparing our bid, CNOOC Limited always anticipated that our merger with Unocal would be reviewed by the Committee on Foreign Investment in the US (CFIUS). We are fully prepared to participate in a CFIUS review of the transaction and we have proactively made assurances to Unocal to address concerns relating to energy security and ownership of Unocal assets located in the US.
“CNOOC Limited has said that we are prepared to sell or take other actions with respect to Unocal’s minority pipeline interests and storage assets so long as such a sale does not cause substantial economic harm to Unocal, and we will reiterate this commitment to the CFIUS committee when appropriate. We are also open to discussing with CFIUS placing non-E&P assets under American management through arrangements that CFIUS has approved often in the past.
“We are prepared to enter into talks with the CFIUS committee to discuss these issues as soon as the committee is ready to do so.”
CNOOC Limited submitted its bid recently, topping the US$16.4 billion offer for Unocal by Chevron. In April, Unocal agreed to accept the Chevron offer.
Unocal has indicated it will consider CNOOC’s US$67 per share all cash offer amid growing opposition among conservatives in the US fearing the Chinese buy-in would threaten American interest.
Mr Fu added: “We believe this offer brings superior value to Unocal shareholders. It is important to know that 70% of Unocal’s current reserves are located in Asia, and that is one of the reasons why this transaction makes sound business sense for our company.
“Substantially all of the oil and gas produced by Unocal in the US will continue to be sold in the US. The development of properties in the Gulf of Mexico will provide further supplies of oil and gas for American markets. I want to re-emphasise our commitment to retain the jobs of substantially all of Unocal’s employees, as opposed to Chevron’s plan to lay off employees, especially in the US.”