Nexen Inc. (formerly Canadian Occidental Petroleum Ltd.) was formed under the laws of Canada on July 12, 1971 through a reorganization which combined the crude oil, natural gas and sulphur operations of its predecessor Jefferson Lake Petrochemicals of Canada Ltd. and the Canadian crude oil, natural gas and chemicals operations of Occidental Petroleum Corporation of Los Angeles, California. Following the amalgamation, Occidental Petroleum Corporation owned 80% of CanadianOxy's outstanding stock.

In the 1970s, CanadianOxy:

• Expanded exploration activities to include offshore Texas and Louisiana in the Gulf of Mexico;
• Bought Occidental Minerals Corporation of Canada; and 
• Acquired sodium chlorate facilities in Brandon, Manitoba and British Columbia.