How will the UK react to China’s investment in the North Sea?

China stormed into the North Sea oil and gas industry this week as deals worth about £11bn were signed with major players. The deals saw two Chinese state-controlled oil companies take stakes in North Sea operations. China’s biggest offshore oil producer CNOOC announced a $15.1bn (£9.7bn) deal to take over Canadian rival Nexen. Reported the BBC 

Given the sums, no surprise that the cry from oil industry analyst Malcolm Graham-Wood at VSA Capital was: “The Chinese are coming with their wall of money!” Reported The Telegraph 

Still, money is not the only consideration in purchases of this kind, which will have to be signed off by the UK Government, among other authorities around the world. Eyebrows inevitably raise at the political niceties of having North Sea energy reserves in the hands of Beijing.

Consultancy Wood Mackenzie calculates that together the two Chinese firms will directly own 13pc of all UK oil production if both deals go through. 

“They are both big credible companies, with good technical expertise and strong balance sheets,” says Grant, who does not expect them to be held up on the UK side.

“In a way they could not have come at a better time. Both deals bring well needed potential new investment to the North Sea.” Full article available here

The UK are not the only authority who need to sign off on these deals.. How will the US and Canada view these opportunities?

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