Talisman Energy said today it would be maintaining its capital spending in the North Sea this year, but that longer term it would seek to reduce its exposure in the region.
Announcing its 2012 capital spending plans it said it would be slightly dropping its global investment in 2012, with overall spending at £2.5billion – a reduction of about £323.6million compared to 2011.
In the North Sea it said it expected to spend about £776million in 2012, about the same as in 2011, with about £517million of that earmarked for the UK.
However, it said: “We will continue to invest in this business to ensure the integrity of our installations and to secure the very important cash flow it generates, but will also seek to reduce our exposure somewhat to this mature and relatively volatile business over time.”
The North Sea, including the UK and Norwegian continental shelves, provided more than £388.4million of cash to the business last year.
UK senior vice president Geoff Holmes said Talisman had a high working interest in many of its operated fields and had said it would be diluting its position in the UK in some of its bigger proposed field developments.
He added: “Whilst a number of options for change are being looked at, the North Sea remains an important part of Talisman’s global portfolio.
“We have a busy year ahead with three drilling rigs on contract, platform drilling on Clyde and a substantial investment programme to further improve integrity across all our offshore sites and at the Flotta oil terminal.”
John Manzoni, president and chief executive said: “Our plans for 2012 have been shaped by low North American natural gas prices and a cautious view of the economic landscape in general.
“Strategic repositioning of the portfolio will continue in 2012, through high grading the North American portfolio, seeking to reduce our interest in some North Sea assets over time, and focusing the exploration portfolio.”
He said Talisman was looking to sell between £647million-£1.2billion of non-core assets this year.
Talisman said production in the North Sea was expected to average between 95,000-110,000 barrels of oil equivalent per day in 2012.
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