Talisman 2010 Highlights | Talisman Energy Online Annual Report 2010

We made progress in transitioning Talisman’s portfolio to establish safe, profitable growth.

Cash flow ¹ was $3.1 billion, down 23% from 2009, due to higher cash taxes in 2010 and lower cash proceeds from financial instruments.
Net income was $648 million, a 48% increase from the previous year, due to higher commodity prices, improved operating performance and non-cash gains on derivatives.
Earnings from continuing operations ¹ were $347 million versus $631 million a year ago. Stronger operating performance was more than offset by higher cash taxes and the effect of cash proceeds from financial instruments in the previous year.
Talisman maintained capital discipline, reducing capital spending by 6% during 2010, to $4 billion.
Production averaged 417,000 boe/d, significantly above initial guidance. Excluding asset sales, year-on-year production increased 7%, with fourth quarter volumes 10% higher than 2009.

Talisman replaced 164% of production with proved reserves, excluding price revisions, achieving a 35% reduction in replacement costs compared to 2009 and a 63% reduction over the past two years. Proved developed producing replacement costs were 54% lower than 2009.
Talisman sold over $2 billion of non-core assets in 2010, predominantly North American natural gas properties.
Talisman entered into a strategic partnership with Sasol Limited, selling them a 50% interest in the company’s Farrell Creek shale play in British Columbia.
The company acquired assets in two liquids areas, establishing a material position in the heart of the liquids rich window in the Eagle Ford shale play in Texas; and also acquired producing assets with significant upside in Colombia.
Talisman made a number of exploration discoveries in Latin America, including an oil discovery and several successful stratigraphic tests in Colombia.