Talisman Energy Inc. is spending $570 million to acquire 170,000 additional net acres in northeastern British Columbia’s Montney and Pennsylvania’s Marcellus shale gas plays and plans to increase drilling activities in both areas in the coming months. The Montney basin is south east of BC’s prolific Horn River basin – Canada’s largest shale gas deposit, and possibly the largest in North America.
The Company increased its Montney Tier 1 land holdings by 80,000 to 166,000 net acres. Talisman expects to drill 20 pilot wells in the area this year and move to commercial development in the beginning of 2010. Tier 1 means the natural gas can be produced at a cost of US$4 per 1,000 cubic feet.
The acquisition of these shale gas plays is part of a new strategy announced in May 2008 which focuses on unconventional natural gas like shale gas. As part of this strategy shift announcement in May, Talisman has sold approximately $2.8 billion worth of assets or about 31,000 barrels per day of production to reinvest in unconventional gas assets.
Talisman’s CFO, Scott Thomson is quoted as stating:
“Proceeds received allow us to accelerate the implementation of our strategy in a fashion that maintains balance sheet strengt. We will continue to evaluate opportunities to focus the portfolio, particularly on North America, and will proceed with additional disposition if the value received and the strategic rationale make sense for Talisman.”
