**Exhibit 11.1**

 

**Nexen Inc.**

**Statement re: Computation of Earnings per Share - U.S.GAAP**

**For the Year Ended December 31, 2008**

 

(Amounts in Cdn $ millions, except shares and per share amounts)

 
| ** **                                                             | ** ** | **2008**           | ** ** | **2007**           | ** ** | **2006**           | ** ** |
|------------------------------------------------------------------------|------------|--------------------|------------|--------------------|------------|--------------------|------------|
| ** **                                                             | ** ** | **Quarter 1** | ** ** | **Quarter 2** | ** ** | **Quarter 3** | ** ** | **Quarter 4** | ** ** | **Annual** | ** ** | **Annual** | ** ** | **Annual** | ** ** |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Net income available to common stockholders  (U.S.  GAAP)              |       | $617               |       | $318               |       | $1,006             |       | ($237 | ) | $1,704 |   | $1,012 |   | $579 |   |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Basic                                                                  |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Weighted average number of common shares  outstanding (thousands)      |       | 528.9              |       | 530.0              |       | 525.9              |       | 519.5 |   | 526.1 |   | 527.1 |   | 524.2 |   |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| **Basic earnings per share**                                           | ** ** | **$1.17**          | ** ** | **$0.60**          | ** ** | **$1.91**          | ** ** | **($0.46** | **)** | **$3.24** | ** ** | **$1.92** | ** ** | **$1.10** | ** ** |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Diluted                                                                |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Weighted average number of common shares  outstanding (thousands)      |       | 528.9              |       | 530.0              |       | 525.9              |       | 519.5 |   | 526.1 |   | 527.1 |   | 524.2 |   |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Net additional shares issuable pursuant to stock  options (thousands): |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Issuable on exercise                                                   |       | 22.5               |       | 24.9               |       | 19.6               |       | — |   | 18.8 |   | 26.6 |   | 27.7 |   |
| Re-purchasable from proceeds                                           |       | (14.2              | )          | (14.4              | )          | (13.0              | )          | — |   | (12.7 | ) | (15.7 | ) | (14.0 | ) |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Net dilutive effect of stock options  (thousands)                      |       | 8.3                |       | 10.5               |       | 6.6                |       | — |   | 6.1 |   | 10.9 |   | 13.7 |   |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| Adjusted number of common shares  (thousands)                          |       | 537.2              |       | 540.5              |       | 532.5              |       | 519.5 |   | 532.2 |   | 538.0 |   | 537.9 |   |
|                                                                   |       |               |       |               |       |               |       |   |   |   |   |   |   |   |   |
| **Diluted earnings per share**                                         | ** ** | **$1.15**          | ** ** | **$0.59**          | ** ** | **$1.89**          | ** ** | **($0.46** | **)** | **$3.20** | ** ** | **$1.88** | ** ** | **$1.08** | ** ** |

 

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