TALISMAN ENERGY TO SELL NATURAL GAS ASSETS
Talisman Energy Incorporated, the Canadian oil company that shed C$2.3bn ($2.3bn) in assets last year, agreed to sell natural-gas fields in Alberta and Ontario for C$1.9bn to free up cash for shale projects.
The assets, which pump the equivalent of 42,500 barrels of oil per day, are being sold in five separate transactions, the Calgary-based company said today in a statement. The buyers weren't identified. Talisman said it expected to close the sales by the end of June.
North American gas producers are increasing output from shale formations, where rocks hundreds of feet below the ground are fractured to unlock fuel deposits. Talisman's reserves have declined for two straight years, and its production remains below 2005 levels, according to data compiled by Bloomberg.
'These sales are value-accretive and will help us focus on, finance and build our growing, low-cost North American shale-gas business,' Talisman Chief Executive Officer, John A. Manzoni said in the statement.
The assets in Talisman's latest divestitures include proved reserves equivalent to 120 million barrels of oil, according to the statement. Gas accounts for about 90 per cent of production from the fields, which are located in Ontario, Alberta's Peace River Arch and Hinton areas and the central Alberta Foothills.
Talisman fell 23 cents, or 1.3 per cent, to C$17.60 at 9:56am on Wednesday on the Toronto Stock Exchange. The stock has dropped 11 per cent this year.