The risk-return receipts off unconventional [gas resources] are actually very compelling."

Globe says Manzoni takes the Buckee out of Talisman

2008-12-15 06:57 ET - In the News

The Globe and Mail reports in its Saturday edition that Talisman Energy today is not Jim Buckee's Talisman. The Globe's Norval Scott quotes John Manzoni, the former BP PLC executive who took the helm in September, 2007, as saying: "There is quite a lot of change in how we run the company. My style is quite different from Jim's."

For 15 years, Talisman was synonymous with Mr. Buckee, an occasionally brilliant and always controversial astrophysicist who took the company to the far corners of the planet, fought publicly with social activists and ran the head office as his personal domain. Under Mr. Manzoni, who has set out to remake Talisman, the company is more inclusive. Talisman still operates in 16 countries, and recently expanded into Iraqi Kurdistan. Mr. Manzoni has his eye on Canada.

He spent his first year in Calgary drafting a strategy to focus on long-term unconventional gas prospects in North America. Now, he must show some results for shareholders. "The old strategy had, in some senses, run its course," said Mr. Manzoni. "One's got to be slightly cautious about following a fad, but it's more than a fad. The risk-return receipts off unconventional [gas resources] are actually very compelling."

Oil spikes as OPEC readies cut

Oil spikes as OPEC readies cut

PABLO GORONDI
Monday, December 15, 2008
Oil prices were up sharply near $49 (U.S._ a barrel Monday as investors anticipated OPEC will announce a large production cut at its meeting this week.

By midday in Europe, light, sweet crude for January delivery was up $2.47 to $48.75 a barrel in electronic trading on the New York Mercantile Exchange. On Friday, the contract fell $1.70 to settle at $46.28.

In London, January Brent crude rose $2.06 to $48.47 on the ICE Futures exchange.

The Organization of Petroleum Exporting Countries, which accounts for 40 per cent of global supply, has signalled it plans to announce a substantial reduction of output quotas at its meeting Wednesday in Algeria.

“The extent of such cuts is still unclear and this uncertainty has been a source of continuing volatility in futures markets,” said a report by analysts at KBC Market Services in Great Britain.

On Monday, the Nymex contract was trading in a relatively wide range between $45.92 and $49.00.

Olivier Jakob of Petromatrix in Switzerland noted that trading volumes last week showed a “sharp rebound” for Nymex crude, “close to double the volume seen in the two previous weeks” and near the highest levels seen this year, above 700,000 contracts a day.

Iranian Oil Minister Gholam Hossein Nozari was quoted Sunday on his ministry's web site saying that Iran would push for a production cut of 1.5 to 2 million barrels per day.

Analysts have questioned whether OPEC members will follow through with any announced cut.

“They're talking about a severe cut, but the question is their discipline,” said Christoffer Moltke-Leth, head of sales trading at investment firm Saxo Capital Markets in Singapore. “Unless they really surprise the market, this cut may not support the price much.”

Oil has jumped from a four-year low earlier this month of $40.50 a barrel on expectations that an OPEC output reduction could be the catalyst to stabilize the oil price, which has fallen 65 per cent since July.

“For the first time in several weeks, there are signs that crude prices might have bottomed out and could be heading upward again,” KBC Market Services said.

Investors largely ignored OPEC's 1.5 million barrels a day output cut in October, focusing instead on a slowing global economy that's hurt crude demand.

More bad macro-economic and company news from the U.S. and Europe over the coming weeks will likely push oil prices lower, Mr. Moltke-Leth said.

“I expect crude to continue its slide and I don't think OPEC is going to prevent that,” he said. “Demand destruction in the major economies will still very much be on the agenda. We could go as low as $30 a barrel.”

Petromatrix's Mr. Jakob said that while no new data was expected this week to show a global rise in appetite for crude, the impact of the OPEC meeting on the supply side likely would be considerable.

“There is no data available to point to an improving demand, but this week will be focused on the supply side and the global supply and demand for the first half of 2009 will need to be rewritten on Thursday after the OPEC decision,” he said.

In other Nymex trading, gasoline futures rose 5.40 cents to $1.1317. Heating oil gained 7.48 cents to $1.5682 a gallon while natural gas for January delivery jumped 9.7 cents to 5.585 per 1,000 cubic feet.

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