Cnooc, China's largest offshore oil exploration firm, said it will acquire bankrupt Opti Canada for $2.1 billion in an effort to boost its presence in the oil sands region of Western Canada. Canada's oil sands region is believed to be home to the third-largest oil reserves in the world after Saudi Arabia and Venezuela.
Cnooc (CEO) will pay $34 million in cash for Opti Canada's outstanding shares, $1.18 billion for outstanding notes and assume $825 million in debt. Amid a cash crunch, Opti Canada sought bankruptcy protection earlier this month.
Chinese companies have bid more than $88 billion for oil, natural gas and power assets overseas in the last five years to meet demand in the world's fastest growing major economy and the biggest energy consuming nation, according to Bloomberg News. Cnooc has been one of the more acquisitive Chinese oil majors, plunking down $13 billion on international deals in the past five years.
Cnooc, China's third-largest oil company, expects the deal to be completed in the fourth quarter. The purchase of Opti Canada will increase Cnooc's proved reserves by 5.3% and total production by 1%, the Chinese company said. Opti Canada currently produces about 30,000 barrels of oil equivalent per day and is believed to have substantial room for increases, Bloomberg reported.