Oct 30 (Reuters) – Talisman Energy Inc , the
Canadian oil company that recently replaced its chief executive
amid takeover speculation, reported a quarterly loss due to its
planned exit from Peru and delays affecting its oil platform in
Norway.
Under Hal Kvisle, who took the helm from John Manzoni in
September, Talisman plans to focus on near-term cash generation
and on projects that come into production more quickly.
“We are working toward a disciplined capital plan for 2013
in the range of $3 billion, smaller and more focused than we’ve
seen in recent years,” Kvisle, the former chief at Canada’s
largest pipeline company TransCanada Corp, said in a
statement.
Talisman, which had been shifting to liquids-rich gas
prospects as dry gas prices languished near 10-year lows, plans
to strengthen its core regions of the Americas, Southeast Asia
and the North Sea, while shedding its non-core assets.
“We will live within our means. We will set capital spending
budgets that can be funded by operating cash flows,” Kvisle
said. The company will reduce up front capital on high-risk
exploration in multiple regions around the world, he said.
Talisman said last month it was giving up its
eight-year-long effort to produce oil in Peru.
The company has shifted its efforts to oil-rich fields such
as Eagle Ford in Texas as well as early stage Duvernay
liquids-rich gas acreage in Alberta.
Shares of the company, which has a market value of about
C$13 billion, closed at C$12.05 on the Toronto Stock Exchange on
Monday. They have fallen 7 percent since the start of the year.
YME, SHALE CURBS HURT
The net loss in the quarter was $731 million, or 71 cents
per share, compared with a net profit of $521 million, or 51
cents per share, a year earlier.
Talisman said $443 million in after-tax impairment charges
due to its planned exit from Peru, restrictions on shale
operations in Quebec and uncertainties with the Yme oil platform
in Norway hurt results.
The company said last week it would fix faulty legs on its
Yme oil and gas platform, which was evacuated in July.
The project, for which Talisman is the operator, is well
over a year behind schedule and the company has removed future
production from its corporate forecasts until start-up looks
more secure. Former CEO Manzoni had complained frequently about
the poor workmanship by the platform’s Dutch contractor, SBM
Offshore.
Talisman said loss from operations in the quarter was $36
million, or 4 cents per share, compared with earnings of $165
million, or 16 cents per share, a year earlier.
Low natural gas prices in North America and lower production
in the North Sea hurt, the company said.
Natural gas prices fell 29 percent in the September
quarter to average $2.85 per million British thermal unit.
Production rose 4 percent to 415,000 barrels of oil
equivalent per day (boe/d). T otal revenue and other income fell
12 percent to $1.72 billion.
Cash flow, a glimpse into a company’s ability to fund
development, decreased to $693 million, or 68 cents per share,
from $902 million, or 88 cents per share, a year earlier.
