TLM Huge Crosses After Hours

Talisman Energy Signs Agreement With KRG

Talisman Energy Signs Agreement With KRG
10:03 EDT Monday, June 23, 2008

CALGARY, ALBERTA--(Marketwire - June 23, 2008) - Two wholly-owned subsidiaries of Talisman Energy Inc. (TSX:TLM) (NYSE:TLM) have entered into agreements with the Kurdistan Regional Government (KRG) within Iraq for interests in Blocks K44 and K39 respectively, effective upon completion of certain conditions, which Talisman expects will be satisfied within 60 days.
"This is an exciting opportunity in a world class hydrocarbon basin," said John A. Manzoni, President and Chief Executive Officer. "It is a great fit in terms of Talisman's global expertise and the strategic objectives of our exploration program, with the potential to become a core producing area for us.
"We have done extensive due diligence, including careful review of legal, regulatory, security and corporate responsibility issues. Block K44 is an established Production Sharing Contract (PSC) area, entered into by the KRG prior to the effective date of the new Iraqi constitution. The block is in the early stages of exploration with a well currently drilling. Both blocks are within the territory widely recognized as being on the KRG side of the 'Green Line' boundary that currently demarcates the region of Kurdistan within Iraq."
Talisman will acquire a 40% interest in Block K44, with WesternZagros Limited (a wholly owned subsidiary of WesternZagros Resources Ltd.) holding 40% as operator and the KRG retaining 20%. Talisman plans to spend US$80 million on the block, including past costs and a three well commitment.
Talisman has also entered into a seismic services agreement with the KRG on Block K39 for a period of two years, following which Talisman will have the option to enter into a PSC as operator of the block with a 60% working interest and a one well commitment in the first year. Talisman estimates exploration costs associated with the initial work program on this block to be US$10-15 million.
As part of the transactions with the KRG and in keeping with Talisman's corporate responsibility policies and practices, the Company will pay US$220 million plus further conditional contributions to the KRG for the sole purpose of providing financial support to infrastructure and capacity building projects for the benefit of the people in the region and, in particular, the local communities in the agreement areas. The KRG is bound to adhere to the principles of the Extractive Industry Transparency Initiative (EITI) pursuant to the Kurdistan Regional Oil and Gas Law. Talisman and the KRG have confirmed their mutual commitment to revenue transparency in the spirit of the EITI, as well as to promoting respect for and compliance with human rights principles, including those set forth in the Voluntary Principles on Security and Human Rights.
Talisman Energy Inc. is an independent upstream oil and gas company headquartered in Calgary, Alberta, Canada. Talisman has operations in Canada and its subsidiaries operate in the UK, Norway, Southeast Asia, North Africa and the United States. Talisman's subsidiaries are also active in a number of other international areas. Talisman is committed to conducting its business in an ethically, socially and environmentally responsible manner. The Company is a participant in the United Nations Global Compact and included in the Dow Jones Sustainability (North America) Index. Talisman's shares are listed on the Toronto Stock Exchange in Canada and the New York Stock Exchange in the United States under the symbol TLM.

Talisman will act as operator of the exploration project, OMV said.

OMV Buys 30% Stake In Norwegian Exploration License
04:46 EDT Monday, June 23, 2008

VIENNA -(Dow Jones)- Austrian oil and gas company OMV AG (OMV.VI) Monday said it has acquired a 30% interest in a Norwegian offshore exploration license, bringing its total exploration projects in the Scandinavian country to six.
"We are well on track to build up a strong position in Norway and seek to further this by securing additional high quality exploration acreage in the future," OMV executive board member Werner Auli said in a statement.
The new license is located in the Norwegian North Sea 300 kilometers southwest of the city of Stavanger. OMV's Norwegian subsidiary OMV AS acquired the 30% stake from the Norwegian unit of Canadian Talisman Energy Inc. (TLM) and Danish energy company DONG's Norwegian subsidiary DONG E&P Norge AS.
Talisman and DONG continue to hold stakes of 42% and 28%, respectively. Talisman will act as operator of the exploration project, OMV said.
OMV was awarded four offshore exploration licenses in Norway in 2007, and one in February 2008. Of the total six licenses, two are located in the Barents Sea, two in the North Sea and two in the Norwegian Sea.
Company Web site: www.omv.com
-By Flemming E. Hansen, Dow Jones Newswires; +43 1 513 69 22 10; flemming.hansen@dowjones.com (END) Dow Jones Newswires
06-23-08 0446ET
Copyright (c) 2008 Dow Jones & Company, Inc

Talisman CEO sees $90.00 per barrel oil

Talisman CEO Sees Oil Prices Staying Above $90/Bbl Next 2 Yrs
07:37 EDT Monday, June 23, 2008

(This article was originally published Friday)
CALGARY (Dow Jones)--Crude oil prices are likely to stay above $90 a barrel in the next couple of years as resource-rich nations continue to squeeze out foreign investment, Talisman Energy Inc.'s (TLM) chief executive said Friday.
Speaking at an event in Calgary, John Manzoni added that the oil market was clearly "in a structural fix" with supply growth lagging demand, rather than speculative activity fueling the high prices.
"It's going to stay structurally high for a year or two," Manzoni said, adding "certainly not at $140 a barrel...but at $90 plus."
The back end of the oil price curve reflects the marginal cost of supply, he said, noting that oil prices flattened out at the $70/bbl level a few years ago as it became more economical to bring on higher-cost crude, such as from Alberta's vast oil sands.
But the multibillion-dollar revenues generated by oil companies as prices surged past $100/bbl have prompted a number of oil-rich nations to renegotiate contract terms, sometimes forcibly, as in Venezuela and Russia. Some Canadian provinces such as Alberta have also raised their share of energy revenues.
"It's not money in this world that's short, it's opportunity," Manzoni said. " It's the opportunities to invest that money which are the limiting factors."
He added that natural gas prices were also likely to remain above $8-$9/mmBtu, noting that half of new U.S. supplies were coming from high-cost tight gas plays.
Alternative sources are still "another technology cycle and a half" away, and only a major slowdown in demand will curb the oil price rally, Manzoni said.
Oil producers such as the Organization of Petroleum Exporting Countries have consistently maintained that speculative fund money and the weakening dollar have powered the surge in oil prices, rather than an imbalance in supply and demand.
While speculation and currency fluctuations are issues, they aren't driving the long-term oil price, Manzoni said. He noted that the amount of money piling into longer-dated oil contracts has increased "dramatically,"but it's not all speculative fund money that's investing for the short term.
-By Hyun Young Lee, Dow Jones Newswires; 613-237-0669; hyunyoung.lee@ dowjones.com (END) Dow Jones Newswires
06-23-08 0736ET
Copyright (c) 2008 Dow Jones & Company, Inc