CNOOC to Halt Operations in the US, UK, and Canada over Sanctions

Industry sources said that China’s top offshore oil and gas producer CNOOC Ltd. would be exiting its operations in Britain, Canada, and the United States because of concerns assets could become subject to Western sanctions.

CNOOC is seeking to sell “marginal and hard to manage” assets in Britain, Canada, and the United States, the senior industry source said on condition of anonymity because of the sensitivity of the issue.

Last week, the United States said that China could face consequences if it helped Russia evade Western sanctions that have included financial measures that restrict Russia’s access to foreign currency and make it complicated to process international payments.

According to reports, CNOOC had hired Bank of America last month to prepare for the sale of its North Sea assets, including a stake in one of the basin’s largest fields.

Reports also said that CNOOC was taking advantage of a rally in oil and gas prices, driven by Russia’s invasion of Ukraine on Feb. 24, and hopes to attract buyers as Western countries seek to develop domestic production to substitute Russian energy.

In its prospectus ahead of the initial public offering, CNOOC said it could face additional sanctions.

“We cannot predict if the company or its affiliates and partners will be affected by U.S. sanctions in future if policies change,” CNOOC said.

CNOOC would be acquiring new assets in Latin America and Africa and would prioritize the development of new prospects in Brazil, Guyana, and Uganda, according to reports.

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