Shares in Canada's Talisman fall on sanctions talk
CALGARY, Oct 27 (Reuters) - Shares in Talisman Energy Inc., Canada's biggest global oil producer, sank nearly 6 percent on Wednesday, a day after the Canadian government warned it could face sanctions for operating in war-torn Sudan.
Canadian Foreign Affairs Minister Lloyd Axworthy said on Tuesday sanctions on Talisman were a possibility if a team formed to probe alleged human rights abuses in the African nation found the firm was playing a role in extending a 16-year civil war through its oil operations there.
Calgary-based Talisman downplayed the threat, saying it welcomed the opportunity for it and Canada to play a role in bringing peace to the impoverished country.
U.S. Secretary of State Madeleine Albright also criticized Talisman over the weekend.
Shares in Talisman, which has a 25-percent interest in a major Sudan oil development, sank C$2.35 to C$38.60 on the Toronto Stock Exchange on Wednesday, representing an 11 percent drop in two days.
Talisman's New York Stock Exchange-listed shares fell $1 on Wednesday to close at $26-1/2.
``I'm taken aback that the market has decided to take such a negative tone on this thing, considering that there has been little or nothing that you can really tie down from the Canadian government or the American government,' said Martin Molyneaux, analyst with Calgary-based Brokerage FirstEnergy Capital Corp.
Molyneaux said Talisman's fast-expanding operations around the world, which also include projects in Canada, the North Sea, Indonesia and Algeria, remained fundamentally sound and he continued to believe the company's stock would exceed C$60 within 12 months.
The company has been criticized by rebels in Sudan's mostly Christian and animist south as well as international church groups, who say it is involved in an oil development from which Sudan's Islamic government will use revenues to fuel the war against people in the region.
Axworthy said he wanted to meet Talisman Chief Executive Jim Buckee next week to demand the firm do more to help broker peace, encourage the Sudan's Islamist government to improve the country's human rights record and start talks with Khartoum to ensure oil revenues were spent on humanitarian aid.
Talisman's partners in the 150,000-barrel-a-day oil project are China National Petroleum Corp., Malaysia state oil company Petronas and the Sudan government.
($1=$1.47 Canadian)
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