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Canada Official: Government Must Accommodate Foreign Investment

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OTTAWA – Canadian Finance Minister Jim Flaherty said Thursday his government needed to have some "accommodation" in its policy regarding foreign investment.

The comments, in an interview broadcast on Canadian Broadcasting Corp., came as Canada's Conservative government reviews a proposed, but controversial, $15.1 billion takeover led by China-owned Cnooc Ltd. of Calgary, Alberta's Nexen Inc.

"We know we don't have enough capital in this country to develop the resources that we want to develop," Mr. Flaherty said. "We have to have some accommodation with respect to foreign investment."

He said crafting policy regarding foreign investment is "complicated."

Under Canadian law, the government must vet and sign off on all big foreign-led deals. But Cnooc's bid, believed to be the largest by a Chinese state-owned company, has prompted the Canadian government to develop new guidelines regarding foreign takeovers. The government has said those guidelines would be released at or around the same time as its decision on Cnooc, which is expected next month.

Meanwhile, Malaysia's Petroliam Nasional Bhd., another state-owned energy company, said this week it submitted to the Canadian government a revised takeover offer for Progress Energy Resources Corp., a bid valued at 5.18 billion Canadian dollars ($5.19 billion).

In October, the Canadian government rejected Petronas's initial offer, arguing it didn't offer a so-called net benefit to the Canadian economy.
 

WHAT DO YOU THINK?

Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Rob Dean | Nov. 27, 2012
Though limited to this single experience in oil and gas industry (publicly traded sector) in Indonesia, I found this group of Indonesians to be anything but forthright; willfully missrepresenting voice and/or written communication even to their own securities governance body. We were ultimately forced to litigate, thank the foresight of the President to have the Joint Venture Agreement be governed by the laws and statues of a province Canada. Take a moment to find Audited Financial Statements for Malaysias Petroliam Nasional Bhd or the audited statements for the subsidiary KLCC Property Holdings Berhad. I was Unable to find any for the former and latters statements were available but on a consolidated basis only. Additionally while the formers statements alluded to a pending litigation they did not disclose anything else and where not even reported on the audited statements. A year end Change was not disclosed nor where those (IFRS) International financial Resporting Standards which were to be complied with by 2011. If a company owned by the state can flout authority in its own country, let alone international financial reporting standards how much weight are you willing to accord their representations. Im not arguing your point that Canada needs investment, but I am arguing that we look out for the interests of Canadians, not just currently but with a view to generations in the future. I would caution the Honourable Minister regarding the "accomodation" What are we providing? It makes no sense to provide raw undeveloped lands in the north when there remains the opportunity to upgrade exhisting transmission facilities. What are the safeguards you allude to with respect to Canadians. Are they in fact enforcible? What about specific performance and reclamation considerations or are you just going to accept thier word. It seems to me that citizens mostly get the short end of the stick when it comes to words and promises. Take a look at Exon & Alaskans; BP & Gulf States or Chevron(Toxico...Texaco) and Equador and Enbridge & Wisconsin pipeline leak if you require support for that contention. Just sayin...dont give away the keys to the store!!!!



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