Tuesday, June 14, 2011

Talisman hunting for more oil-rich Eagle Ford assets..Will clinch deals if price are in-line

Canadian O&G company, Talisman Energy has oil and gas assets in North America, the North Sea and Southeast Asia. The company is pursuing a number of high-impact international exploration opportunities for 2011. In 2010, Talisman produced 417,000 boepd, approximately 50% oil and 50% natural gas.

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Talisman's Transforming to Oil-Focused Company:

In terms of the portfolio, the company completed the sale of $2 billion of non-core, predominantly North American natural gas assets during 2010, bringing the total to $5 billion over the past two years. In general, the intent was to sell higher-cost, high-decline conventional gas assets and reposition the portfolio towards lower-cost, long-life assets, focusing on liquids.

"In North America, our emphasis will shift to liquids, and we will reduce gas directed spending by 35%. Our reduced gas directed drilling remains profitable at US$4 prices, and our land retention commitments are relatively minor. With the Eagle Ford acquisition complete, we plan to build to eight rigs by year end, with net Talisman production expected to average 55-65 mmcfepd, just under half of which will be liquids” said John A. Manzoni, President and Chief Executive Officer, Talisman.

Talisman’s Divestitures from 2010:

Following the successful entry into the liquids-rich Eagle Ford through two acquisitions in 2010, the company is expecting to drill approximately 35 net wells. Talisman expects to ramp up to eight operated rigs by year end, and has budgeted approximately US$300 million. Net annual production from this play is estimated at 55-65 mmcfepd. Approximately half of this production is expected to be liquids.

Shale production in North America is expected to average 455-525 mmcfepd (~75,000-85,000 boepd), with an additional 90,000 boepd of conventional production.

Talisman in Eagle Ford:

Talisman took its first position in Eagle Ford in May 2010, buying 37,000 acres, and augmented that in December, when it and joint-venture partner Statoil paid $1.33 billion for 97,000 acres
The company successfully sold $2.2 billion of assets through 2010, all at very good metrics, and that allowed company to reposition the portfolio substantially through the year with about $2 billion of acquisitions, including some discoveries in Norway, the BP Colombia acquisition partnering with Ecopetrol, and deepening in the Eagle Ford jointly with Statoil.

Recent Major Transactions in Eagle Ford:

Source Documents:

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