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offshore oil &ocean; engineering CNOOC to Acquire Nexen CNOOC Ltd. (Hong Kong) in July proposed to buy Nexen Inc. (Calgary, Canada) for approximately $15.1 bil- lion at $27.50 per Nexen common share, or around 60 percent more than the company's closing stock price. The transaction is expected to close in the fourth quarter of 2012. The acquisition expands CNOOC's presence in Canada, Nigeria, the U.S. Gulf of Mexico and the U.K. North Sea. CNOOC plans to retain Nexen's management team and employers, and will establish Calgary as its North and Central American headquarters. Members of U.S. Congress ex- pressed concern about the deal. Rep. Ed Markey (D-Mass.) urged U.S. De- partment of the Treasury Secretary Tim- othy Geithner to block the deal until parties agree to pay royalties to the U.S. "Nexen is a major beneficiary of Deep Water Royalty Relief Act, having produced 32 million barrels of oil and 34 billion cubic feet of natural gas in the Gulf of Mexico through May 2012 without paying royalties," Markey wrote in a letter. "If CNOOC takes over Nexen's Gulf of Mexico assets and op- erations, this giveaway of American resources could be extended to a Chi- nese state-owned company." Saying the acquisition illustrates the U.S. should move quickly to secure energy resources in Canada, Republi- can lawmakers made another push for approval of the Keystone XL pipeline. Rep. Lee Terry (R-Neb.) introduced in July a bill that would allow work to immediately begin on the northern segment of the pipeline from the U.S.- Canadian border to the South Dakota- Nebraska border. Italy Lifts Restrictions On Offshore Drilling The Italian government in August ratified legislation that modifies and lifts some of the offshore drilling restric- tions of Legislative Decree 128/2010 (DL128), which in 2010 banned all such activities within 12 nautical miles of the coast (5 for liquid hydrocarbons). Article 25 of the new law states that DL128 no longer applies to applica- tions for production concessions that were under review at the time DL128 came into force; any titles, including exploration licences, that had been is- sued prior to DL128 coming into force; and any proceedings connected with or subsequent to such titles. The decree also includes a provi- sion for a 3 percent increase (to 7 per- cent for oil and 10 percent for gas) in the royalty rates payable for offshore hydrocarbon producers with the pro- ceeds to be allocated to the state bud- gets of the Ministry of the Environment and the Ministry of Economic Devel- opment. Offshore companies that have an interest in this area applauded these changes. CYGAM (Calgary, Canada) said it will begin discussions with au- thorities on advancing its two projects offshore Italy: the Elsa discovery in the Adriatic Sea and the Aretusa prospect in the Mediterranean Sea. Mediterranean Oil & Gas plc (Lon- don, England) will seek an award of production concession covering the Ombrina Mare oil and gas field in the Central Adriatic based on the applica- 76 st / SEPTEMBER 2012 www.sea-technology.com