China National Offshore Oil Corporation: Operations in Canada

Name: China National Offshore Oil Corporation: Operations in Canada
SKU: 9B18M182_P

Xiaoyu Liu; Hao Lu; Loren Falkenberg; Harrie Vredenburg

Product #:9B18M182_P

Supplier:Ivey/Haskayne

Discipline:International Business, Strategy

Setting:Canada, China, 2017

Details:Case (PDF) • 10 pages • 2018-12-04

Subjects:

Business management International business Strategy

Geography:

Canada China North America Asia

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$10.54

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In 2005, China National Offshore Oil Corporation (CNOOC) began investing in Canada, when it acquired 16.69 per cent equity of MEG Energy Corp., a private Calgary-based energy company. In 2011, it acquired OPTI Canada, a Canadian oil company that had gone bankrupt, followed in 2013 by the contentious acquisition of Nexen Inc., a Canadian oil and gas company. Despite this enticing potential market and the desire to fuel China's rapidly growing economy, CNOOC faced low oil prices, slow economic growth in Canada, fierce competition from other multinational oil companies, and pressure from environmental non-governmental organizations. Given these challenges, how could CNOOC achieve success in Canada?

Learning Objectives

This case is designed for use in undergraduate and graduate business courses such as international management, international marketing, and strategic management. Completing this case will give students the opportunity to

assess the Canadian oil sands industry and the attractiveness of the industry;
analyze a company's acquisition strategy (the pros and cons off an acquisition); and
consider how a company can form effective business strategies.