UPDATE 3-CNOOC-Nexen review likely to be extended again - sources

Wed Oct 31, 2012 5:02pm EDT
 
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* Too little time to review Nexen, prepare general framework

* Extension does not mean bid is in trouble-sources

* Harper to be overseas in week running up to Nexen deadline

By Randall Palmer

OTTAWA, Oct 31 (Reuters) - Canada is likely to extend its review of the $15.1 billion bid by China's CNOOC Ltd for oil producer Nexen Inc beyond next week's deadline to allow more time for the government to formulate a broad framework on foreign investment, two sources close to the matter said on Wednesday.

The sources said there was too little time before the Nov. 10 deadline for the federal government to conclude deliberations on the Nexen deal as well as prepare a framework to clarify its overall policy on foreign deals.

Ottawa has promised to announce such a framework at the time it makes its ruling on the Nexen proposal. As a consequence, the sources said, the government would likely seek to extend the review period for a second time.

Under Canadian law, all major foreign takeover proposals are subject approval of the federal government, which must certify that the deals benefit the country.

The sources, who spoke on the condition of anonymity due to the sensitivity of the issue, stressed that the delay was not a signal that the bid was necessarily in trouble.   Continued...