Talisman is a leading independent operator in both the UK and Norwegian sectors of the North Sea. The Company has a proven track record with demonstrated technical, commercial and operating skills. Talisman has established a number of commercial core areas, which provide significant value through low risk development, exploration opportunities, secondary recovery and third party tariff revenue.
Talisman’s focus is the Central North Sea where there is significant remaining hydrocarbon potential. Individual field and prospect sizes can be material for a company of Talisman’s size and new technology and higher prices have greatly expanded the opportunity set.
2006 in review
In the North Sea, Talisman continued work on
11 development projects, which are expected to add
substantial incremental production volumes between
2007 and 2009. The largest of these, the 45,000 boe/d
Tweedsmuir development was more than 90% complete
at year-end, with initial production expected in April 2007.
Talisman successfully integrated the Paladin assets from late 2005 and acquired
the Fulmar and Auk fields in the UK. The Auk field has significant development
potential. Talisman submitted a redevelopment plan for the Yme field in Norway
early in 2007, a field that was abandoned during a period of low oil prices after
having produced only 15% of the 340 mmbbls of original oil in place. Also during
the year, Talisman rationalized its asset base in the UK through the divestment of
non-operated interests in a number of non-core properties.
- liquids production averaged 135,216 bbls/d, up from 132,716 bbls/d in 2005,
primarily due to the acquisition of Paladin assets in late 2005;
- natural gas production averaged 140 mmcf/d, an increase of 17% from
120 mmcf/d in 2005;
- exploration and development spending was $1.6 billion;
- Talisman drilled 29 successful oil and gas development wells, including wells
at Clyde, Tartan, Claymore and Piper, as well as three successful exploration
wells. A successful infill drilling program was also carried out in the Varg and
Veslefrikk areas;
- Talisman added 100 mmboe of proved reserves and had 486 mmboe of proved
reserves at year-end. The additions include 26 mmboe of proved reserves acquired
through the purchase of the Auk field and 87% of the Fulmar field and a decrease
of 10 mmboe through asset sales;
- operating costs averaged $18.00/boe, up from $15.54/boe in 2005, due in part
to the increased cost of fuel gas and facility maintenance;
- Talisman sold interests in a number of minor properties with combined
production of 9,200 boe/d (net Talisman share); and
- early in 2007, the Company also announced it had entered into an agreement to
sell its interests in the Brae region (19,000 boe/d, net Talisman share). This sale
is expected to be completed near the end of 2007.
