Canada approves the CNOOC-Nexen and Petronas-Progress deals


The shape of ships to load in BC – before they’re likely to load in the GOUSA

Canada will no longer allow state-owned companies to takeover businesses in the nation’s oil sands and will toughen requirements in other industries…after Canadian Prime Minister Stephen Harper approved CNOOC’s $15.1 billion takeover of Nexen and Petroliam Nasional $5.2 billion takeover of Progress Energy Resources.

The deal by Beijing-based CNOOC is the largest ever takeover by a Chinese company, according to data compiled by Bloomberg. It gives the state-owned company a stake in Canada’s largest oil-sands project and the biggest position in the Buzzard oil field in the U.K. North Sea…

“These were difficult decisions” that reflect “the broad views of Canadians,” Harper told reporters. Canada relies on exports for one-third of economic output and counts on energy products for almost one-quarter of those shipments…

The Cnooc-Nexen transaction is the biggest in Canada since Calgary-based Suncor Energy bought Petro-Canada in August 2009 for about $18 billion…

“We’re obviously quite pleased with the decision,” said Michael Culbert, chief executive officer of Calgary-based Progress, by phone. “We know that this has been a difficult decision to make and we don’t take that lightly…”

The acquisition of Progress by Petronas gives the Malaysian state-owned company gas reserves to build a liquefied natural gas export facility along the British Columbia coast at a cost of C$9 billion to C$11 billion, the companies said this week.

Petronas has the world’s largest LNG-producing site in Sarawak, Malaysia, according to its website, and also operates the world’s largest LNG carrier fleet.

All the parties with a stake in either enterprise have signed off – excepting of course the United States.

The Monday morning quarterbacks in Congress who waste endless time and space whining about the failure of Asian firms to invest in US corporations – will call press conferences to put their stamp of disapproval on the deal. The reasoning will run the whole gamut of Cold War crackpot concoctions. Hypocrisy will run rampant. Not so incidentally, that will probably include the White House.

The controversies about exploitation of the Alberta oil sands will be settled by Canadians, sooner or later. That’s the reason for complaints by American enviro groups that Congress doesn’t listen to, anyway.

I find the Petronas purchase and plans more interesting. This takes away the last bit of reliance Canadians had on American pipelines for transmission of their NatGas for eventual export. They’ll end up with a significant chunk of national income while American politicians sit around worrying about electoral politics vs utilizing a product cleaner and cheaper than coal to run our power plants, vs utilizing a product cleaner and cheaper than oil to run over-the-road trucking and maybe even something more than six NatGas Hondas in San Francisco – someday.

Xi confident on Chinese economy – discounts Bears and book peddlers


Xi Jinping with Joe Biden, LA Mayor Antonio Villaraigosa
Daylife/Reuters Pictures used by permission

Chinese Vice President Xi Jinping said on Friday the Chinese economy would experience stable growth and avoid a hard landing this year, discounting a scenario economists fear may upset the global economy.

The Chinese leader-in-waiting, turning to courting American companies and governors hungry for a slice of his nation’s growth, told a business forum in Los Angeles that the world’s No. 2 economy will continue to push domestic demand while directing investment toward the United States.

Xi said “2012 will be a crucial year in driving the 12th five-year plan. China’s economy will maintain stable growth … there will be no so-called hard landing.”

“We will encourage more consumption, imports, and outward investment,” he told a business forum in Los Angeles on the final leg of his five-day U.S. visit, drawing light applause…

Xi is poised to become China’s next leader after a decade in which it has grown to become the world’s second-largest economy, while the United States has endured the deepest recession since the Great Depression of the 1930s…

Scores of executives from major U.S. and Chinese companies, from Intel to Microsoft, lined up to sign a plethora of deals after Xi’s address at the economic forum on Friday. Those included “Kung Fu Panda” studio Dreamworks Animation’s venture to make films from Shanghai, and Chinese telecoms giant Huawei’s pledge to award $6 billion of contracts over three years to Qualcomm, Broadcom and Avago.

The Chinese trade delegation this week also inked deals to buy a record 13.4 million tonnes of U.S. soybeans, valued at $6.7 billion. Before Los Angeles, Xi visited the heartland farm state of Iowa, where Chinese soybean buyers announced they would buy more than $4 billion in U.S. soybeans this year…

“China has become the United States’ fastest growing export market,” Xi told an audience of business executives and policymakers on Wednesday. “Speaking frankly, an important aspect of addressing the imbalance in Chinese-U.S. trade is the United States’ own economic policies and structural adjustment…”

A prosperous and stable China will not be a threat to any country,” he said.

None of this differs especially from the analyses of most economists and analysts doing business on the global stage. Of all the information strolling across the electronic stage – all week – the majority reflects this theme.

Professional bears, trying to influence their short-selling egos try to counter reality. And a couple times a week some minstrel show mug will get five minutes interview time trying to sell the latest book on the imminent collapse of China. With or without a secret cabal of lizard people [and a wink to Eddy Elfenbein].

Want a free laptop with that phone?

A new marketing initiative in Britain for Orange, a wireless operator owned by France Telecom, captures the subtle but significant shift taking place in the European mobile industry.

Like most other operators in Europe, Orange dangles a piece of free hardware in exchange for a two-year service contract. But this time, to win customers, Orange is including a laptop computer, not a mobile phone.

The “Connected Laptop” offer includes a free laptop from Asus or Hewlett Packard, a USB modem and up to five gigabytes of downloads for $49 to $88, per month. As mobile operators start giving away devices other than cellphones, experts say, the industry is entering a new phase.

“As the European market gets more saturated, operators are looking at other drivers from a connection standpoint,” said Carolina Milanesi, director of mobile devices at Gartner in London. “The laptop subsidies reflect the growing importance of mobile broadband to the business.”

Cross-marketing agreements between mobile operators and computer makers are becoming more common. Lenovo, the Chinese company that bought IBM’s laptop business, is selling its X200 laptop in Britain with a preinstalled SIM chip from Vodafone and one month of free broadband service.

As Milanesi put it, “If they can have you as a subscriber for your phone as well as for your personal computer, they get you twice.”