HONG KONG (Standard&Poor's) July 24, 2011--Standard&Poor's Ratings Services said today that the rating on China-based CNOOC Ltd. (AA-/Stable/--; cnAAA) is not immediately affected by the company's proposed acquisition of Nexen Inc. (BBB-/Watch Pos/--). In our view, the US$15.1-billion acquisition is larger than previous CNOOC deals in recent years and could test the company's integration ability. Standard&Poor's sees the acquisition as consistent with CNOOC Ltd.'s strategy to expand outside China. The transaction, once completed, would increase CNOOC Ltd.'s proven reserves by about 30% and production by about 20%. More importantly, it provides a good opportunity for CNOOC Ltd. to diversify its operations materially in the low-risk member countries of the Organization for Economic Cooperation and
