CALGARY, Dec. 7, 2012 /PRNewswire/ – Nexen Inc. (TSX: NXY) (NYSE: NXY)
announced today that under the terms of the Investment Canada Act, the Honourable Christian Paradis, Minister of Industry, has approved
the proposed acquisition of Nexen by CNOOC Limited (CNOOC). No further
approvals are required in Canada.

“This is an important milestone in the process and confirms our belief
that this transaction provides a number of significant benefits to
Canada and to Nexen,” said Kevin Reinhart, Nexen’s interim President
and CEO. “We remain focused on working with CNOOC to bring this
transaction to a close.”

The closing of the acquisition remains subject to the receipt of
applicable government and regulatory approvals, and the satisfaction or
waiver of the other customary closing conditions.

About Nexen

Nexen Inc. is a Canadian-based global energy company, listed on the
Toronto and New York stock exchanges under the symbol NXY. Nexen is
focused on three growth strategies: oil sands and shale gas in western
Canada and conventional exploration and development primarily in the
North Sea, offshore West Africa and deepwater Gulf of Mexico. Nexen
adds value for shareholders through successful full-cycle oil and gas
exploration and development, and leadership in ethics, integrity,
governance and environmental stewardship.

Forward-Looking Statements

Certain statements in this Release constitute “forward-looking
statements” (within the meaning of the United States Private Securities
Litigation Reform Act of 1995, as amended) or “forward-looking
information” (within the meaning of applicable Canadian securities
legislation). Such statements or information (together “forward-looking
statements”) are generally identifiable by the forward-looking
terminology used such as “anticipate”, “believe”, “intend”, “plan”,
“expect”, “estimate”, “budget”, “outlook”, “forecast” or other similar
words. Any statements as to possible timing and anticipated receipt of
required regulatory and court approvals for the arrangement with CNOOC
Limited; the ability of the parties to satisfy the conditions to, and
to complete, the transaction; the anticipated timing of the closing of
the transaction; and, changes in any of the foregoing are
forward-looking statements.

All of the forward-looking statements in this Release are qualified by
the assumptions that are stated or inherent in such forward-looking
statements. Although we believe that these assumptions are reasonable
based on the information available to us on the date such assumptions
were made, this list is not exhaustive of the factors that may affect
any of the forward-looking statements and the reader should not place
an undue reliance on these assumptions and such forward-looking
statements. Nexen undertakes no obligation to update publicly or revise
any forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws. The key assumptions that have been made in
connection with the forward-looking statements include the following:
the ability of the parties to the July 23, 2012 Arrangement Agreement
to receive, in a timely manner and on satisfactory terms, the necessary
regulatory, and other third party approvals, including but not limited
to the receipt of applicable foreign investment approval required in
the United States and elsewhere and the required approvals from the
Government of the People’s Republic of China and in other foreign
jurisdictions; and, the ability of the parties to the Arrangement
Agreement to satisfy, in a timely manner, the conditions to the closing
of the transaction.

Forward-looking statements are subject to known and unknown risks and
uncertainties and other factors, many of which are beyond our control
and each of which contributes to the possibility that our
forward-looking statements will not occur or that actual results and
achievements may differ materially from those expressed or implied by
such statements. Such factors include, among others: the possible
failure of Nexen and CNOOC Limited to obtain necessary regulatory and
other third party approvals, including those noted above, or to
otherwise satisfy the conditions to the completion of the transaction,
in a timely manner or at all; if the transaction is not completed and
Nexen continues as an independent entity, there are risks that the
announcement of the transaction and the dedication of substantial
resources of Nexen to the completion of the transaction could have an
impact on Nexen’s current business relationships (including with future
and prospective employees, customers, distributors, suppliers and
partners) and could have a material adverse effect on the current and
future operations, financial condition and prospects of Nexen; the
possible failure of Nexen to comply with the terms of the Arrangement
Agreement may result in Nexen being required to pay a fee to CNOOC
Limited, the result of which could have a material adverse effect on
Nexen’s financial position and results of operations and its ability to
fund growth prospects and current operations; and other factors, many
of which are beyond our control. Additional information on these and
other factors that could affect the completion of the transaction are
included in the information circular and proxy statement of Nexen dated
August 16, 2012, which has been filed with the applicable securities
regulatory authorities and may be accessed through the SEDAR website (www.sedar.com), the SEC’s website (www.sec.gov) and Nexen’s website (www.nexeninc.com).The impact of any one risk, uncertainty or factor on a particular
forward-looking statement is not determinable with certainty as these
factors are interdependent, and management’s future course of action
would depend on our assessment of all information at that time.

SOURCE Nexen Inc.