Nexen Inc.

Nexen Inc.

April 12, 2006 00:55 ET

Nexen Announces Preliminary Results of Arbitration of Block 51, Yemen Dispute

CALGARY, ALBERTA--(CCNMatthews - April 12, 2006) - Nexen Inc. announced today that the International Court of Arbitration of the International Chamber of Commerce released its Partial Award in a dispute regarding two small areas (the Heijah/Tawila Extension Lands) of the Nexen operated Block 51 in Yemen. The Award held that Nexen had breached an obligation to offer a subsidiary of Occidental Petroleum Corporation the right to acquire a 50% interest in these areas and that Occidental is entitled to monetary damages.

Damages will be determined during a second and final phase of the arbitration. The amount of damages cannot be reasonably estimated at this time. Resolution of this matter is not expected to have a material adverse effect on our liquidity, consolidated financial position or results of operations.

Nexen Inc. is an independent, Canadian-based global energy company, listed on the Toronto and New York stock exchanges under the symbol NXY. We are uniquely positioned for growth in the North Sea, deep-water Gulf of Mexico, the Athabasca oil sands of Alberta, the Middle East and offshore West Africa. We add value for shareholders through successful full-cycle oil and gas exploration and development and leadership in ethics, integrity and environmental protection.


Certain statements in this report constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as "intend", "plan", "expect", "estimate", "budget", "outlook" or other similar words, and include statements relating to future production associated with our Long Lake, North Sea and West Africa projects.

The forward-looking statements are subject to known and unknown risks and uncertainties and other factors which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements. Such factors include, among others: market prices for oil and gas and chemicals products; the ability to explore, develop, produce and transport crude oil and natural gas to markets; the results of exploration and development drilling and related activities; foreign-currency exchange rates; economic conditions in the countries and regions where Nexen carries on business; actions by governmental authorities including increases in taxes, changes in environmental and other laws and regulations; renegotiations of contracts; and political uncertainty, including actions by insurgent or other armed groups or other conflict. The impact of any one factor on a particular forward-looking statement is not determinable with certainty as such factors are interdependent upon other factors, and management's course of action would depend on its assessment of the future considering all information then available. Any statements as to possible commerciality, development plans, capacity expansions, drilling of new wells, ultimate recoverability of reserves, future production rates, cash flows or ability to execute on the disposition of assets or businesses, and changes in any of the foregoing are forward-looking statements.

Although we believe that the expectations conveyed by the forward-looking statements are reasonable based on information available to us on the date such forward-looking statements were made, no assurances can be given as to future results, levels of activity and achievements. Readers should also refer to Items 7 and 7A in our 2005 Annual Report on Form 10-K for further discussion of the risk factors.

Contact Information

  • Nexen Inc.
    Kevin Finn
    Vice President, Investor Relations
    (403) 699-5166
    Grant Dreger, CA
    Manager, Investor Relations
    (403) 699-5273