“It’s important to have clarity on this, not just for Canada’s foreign relations with certain super-power nations but also to ensure timely development of these very important resources,” said Robert G. Gill, portfolio manager at Toronto-based Aston Hill Financial, which has more than C$6 billion assets under management.

The two bids tested Harper’s ability to balance the need to bolster economic relations with Asian economies without letting them gain too much influence over the world’s third-largest pool of oil reserves. While allowing the deals, he also said Canada won’t approve state-owned companies taking controlling interests in any more oil-sands projects, except in “exceptional circumstances.”

“These were difficult decisions” that reflect “the broad views of Canadians,” Harper said.

Wang Yilin, chairman of China National Offshore Oil Company said on Saturday the approval was recognition of the acquisition’s long-term economic benefits for Calgary, Alberta and Canada.  “I express my appreciation for Canada’s welcome of our investment,” Wang said in a statement.

Nexen is headquartered in Calgary in Canada’s Alberta province and is to remain there after CNOOC’s takeover as its head office for north and central American operations.

CNOOC chief executive Li Fanrong said the takeover would bring opportunities for Nexen employees, partners and CNOOC. “We are delighted that the Ministry of Industry has concluded that this transaction represents a ‘net benefit’ to Canada,” he said.

China’s Ministry of Commerce could not be reached for comment on Saturday.

“From a perspective of industry this is the perfect solution,” said John Stephenson, who helps manage C$2.7 billion at First Asset Management in a phone interview from Toronto. “You get the benefit of patient capital servicing value for investors and you don’t give up control, which is really the issue most Canadians feel passionately about.”

Shares of Calgary-based Nexen rallied 15 per cent to US$26.94 as of 6:19pm New York time in trading after US exchanges closed, 2 per cent below Cnooc’s US$27.50 offer. The Canadian dollar strengthened, rising 0.3 per cent to 98.84 cents per US dollar as the announcements were made.

The CNOOC-Nexen transaction is the biggest in Canada since Calgary-based Suncor Energy bought Petro-Canada in August 2009 for about US$18 billion. Through its C$2.1 billion acquisition of Opti Canada last year, CNOOC already owns 35 per cent of the Long Lake oil-sands project operated by Nexen. It would gain Nexen’s 20 per cent interest in the Usan offshore Nigerian project operated by a unit of Total.

Progress shares, which surged 74 per cent on the day the first bid by Petronas was announced June 28, closed at C$19.35 in Toronto. Petronas offered C$22 a share.

“We’re obviously quite pleased with the decision,” said Michael Culbert, chief executive officer of Calgary-based Progress, by phone. “We know that this has been a difficult decision to make and we don’t take that lightly.”

An e-mail seeking comment sent to Peter Hunt, a spokesman for CNOOC in Calgary, was not immediately returned. Patti Lewis, a Nexen spokeswoman in Calgary, did not immediately return phone and e-mail messages seeking comment. Azman Ibrahim, a spokesman for Petronas, did not immediately return an e-mail message seeking comment and could not be reached before regular business hours in Kuala Lumpur.

The acquisition of Progress by Petronas gives the Malaysian state-owned company gas reserves to build a liquefied natural gas export facility along the British Columbia coast that would cost C$9 billion to C$11 billion, the companies said this week.

Petronas has the world’s largest LNG-producing site in Sarawak, Malaysia, according to its website, and also operates the world’s largest LNG carrier fleet.

The Canadian decisions came on the same day Glencore International’s C$6.1 billion takeover of Viterra, Canada’s largest grain handler, received Chinese regulatory approval.

Investment by Chinese state-owned companies in Canada’s energy industry has become a contentious issue, and the deals represent the end of a trend of state-owned companies buying Canadian oil-sands firms, not the beginning, Harper said.

Harper said further “foreign state control of oil sands development” would no longer be a net benefit to Canada, which relies on exports for one-third of economic output and counts on energy products for almost one-quarter of those shipments.

Fifty-eight per cent of Canadians wanted the government to block the Nexen takeover, according to an online poll of 1,000 people taken October 10 to October 11 by Angus Reid Public Opinion.

The opposition New Democratic Party called the CNOOC approval “irresponsible” because most Canadians oppose the purchase. “This is a farce,” Peter Julian, the NDP’s spokesman on natural resources, said in a statement. “While Conservatives admit that under the new rules this transaction is not a net benefit to Canadians, they have approved it anyway.”

Natural Resources Minister Joe Oliver has said the country’s biggest resource projects will require nearly C$650 billion of investment to develop over the next decade.

Harper said Canada would raise the threshold for foreign-takeover reviews by private investors to C$1 billion in enterprise value as earlier planned, while the existing threshold of C$330 million in asset value will continue to apply to state-owned enterprises. Industry Minister Christian Paradis would also have the ability to extend the review period to take national security reviews into account, Harper said.

Foreign state-owned businesses would still be welcome to acquire minority stakes and enter into joint ventures with Canadian businesses, Harper said.

CNOOC, which said it received approval from the European Union today on the deal, has not said whether US authorities have approved its takeover of Nexen’s assets in the US Gulf of Mexico, where the Calgary company gets eight per cent of its production.

Natalie Earnest, a spokeswoman at the US Department of the Treasury that oversees the Committee on Foreign Investment in the US, declined to comment in an e-mail, citing confidentiality rules.

CNOOC had already made several commitments to Canada to win support for the Nexen sale. These include listing its shares on the Toronto Stock Exchange, establishing Calgary as its base for North and Central America and maintaining Nexen’s employment levels and capital spending programme.

CNOOC accepted management and employment conditions set by the Canadian government, two people familiar with the matter said November 20.

The approval of the Petronas bid came after Paradis blocked the bid on October 19 and gave the companies 30 days to make additional concessions.