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Gold/Mining/Energy : Canadian Oil & Gas Companies -- Ignore unavailable to you. Want to Upgrade?

To: Richard Saunders who wrote (7462)	8/14/2000 12:59:22 PM
From: LARRY LARSON	Respond to of 24905

Monday August 14, 12:08 pm Eastern Time Press Release Talisman Increases Canadian Capital Program by $118 Million CALGARY, ALBERTA--Talisman Energy Inc. today announced it is increasing its Canadian exploration and development program by $118 million in 2000, from $523 million to $641 million, an increase of 23%. In total, the Company has announced plans to spend approximately $1.6 billion in 2000, including net property and asset acquisitions of $260 million. Talisman expects to generate almost $2.3 billion in cash flow ($16.50/share) based on a full year average WTI oil price of US $28/bbl and 415,000 boe/d of production (an increase of 34% over 1999). ``As some of our international projects come to successful completion and their demands for cash reduce, we can profitably step up activity in Canada,'' said Dr Jim Buckee, President and Chief Executive Officer. ``Strong fundamentals for better oil and domestic gas prices give us the confidence to pursue domestic opportunities more vigorously. ``We are one of the leading North American deep gas companies, with the land base, technical skills and financial strength to grow our large existing gas portfolio. We have positioned Talisman in areas with the greatest onshore reserve potential in Canada. In addition, we have numerous development opportunities within our Western Canada oil operations.'' A significant portion of increased spending is directed at natural gas opportunities in the deeper portion of the Western Canada Basin. This emphasis is consistent with Talisman's strategy of growing oil production internationally and gas production domestically. The supply/demand equilibrium in the North American gas market is expected to lead to strong natural gas prices for the foreseeable future. Talisman is ideally positioned to capitalize on the resulting strong economics of incremental investment in the deeper, more technically challenging areas of the Basin. The Company will increase its Canadian exploration budget from $170 million to $222 million (31% increase). Virtually all of this increase will be directed at gas opportunities. Of the $52 million increase, approximately 30% will be spent on land, 20% on seismic and 50% on drilling (22 net wells). Focus areas will be the Peace River Arch, West Central Plains, the Deep Basin and Foothills. Talisman will increase its Canadian development program from $353 million to $419 million (19% increase). The majority of this spending will be directed at oil projects in Chauvin, Ontario and Carlyle. These are low cost, low risk oil opportunities that can be tied in quickly. Approximately $15 million will be spent on gas development opportunities at Whitecourt, Turner Valley, and Lac La Biche. The increase in development and exploration spending is expected to add approximately 5,000-6,000 boe/d in 2001. Although most of the impact will be felt next year, this spending will also enhance our gas and liquids exit rates in 2000 to approximately 800 mmcf/d and 67,500 bbl/d, respectively. Talisman Energy Inc. is the largest independent Canadian oil and gas producer. The Company has operations in Canada, the North Sea, Indonesia, and Sudan. Talisman is also conducting exploration in Algeria and Trinidad. 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. FORWARD-LOOKING STATEMENTS Statements in this press release may contain forward-looking statements including expectations of future production and capital expenditures. Information concerning reserves may also be deemed to be forward-looking statements as such estimates involve the implied assessment that the resources described can be profitably produced in future. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated. These risks include, but are not limited to: the background risks of the oil and gas industry (e.g., operational risks in development, exploration and production; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), risks in conducting foreign operations (e.g. political and fiscal instability), price and exchange rate fluctuation and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Additional information on these and other factors which could affect Talisman's operation or financial results are included in Talisman's Annual Report under the headings ``Management's Discussion and Analysis - Sensitivities,'' ``Risks and Uncertainties,'' and ``-Outlook,'' and in Talisman's other reports on file with Canadian securities regulatory authorities and the U.S. Securities and Exchange Commission. This release is available on Talisman's Internet Web Site: WWW.TALISMAN-ENERGY.COM -------------------------------------------------------------------------------- Contact: Talisman Energy Inc. David Mann, Manager, Investor Relations & Corporate Communications (403) 237-1196 (403) 237-1210 E-mail: tlm@talisman-energy.com Website: www.talisman-energy.com

To: Richard Saunders who wrote (7462)	8/16/2000 1:30:10 AM
From: CIMA	Read Replies (2) \| Respond to of 24905

Oil Prices to Breed Discontent This Winter Summary The price of crude oil rose to more than $32 per barrel on Aug. 15, reaching a 10-year high. While the upsurge was attributed to a comment made by Venezuela's president, it actually reflects current market conditions. An increase in oil production by the Organization of Petroleum Exporting Countries (OPEC) would help alleviate prices but is unlikely to occur. High energy prices will persist through the winter and affect every sector of the global economy. Analysis Crude oil prices rose to more than $32 per barrel on Aug. 15. The price spike was widely attributed to a comment made by Venezuelan President Hugo Chavez that oil producers should not allow prices to drop below their current levels. Chavez is currently touring nations that make up the Organization of Petroleum Exporting Countries (OPEC) in preparation for a September heads of state summit in Caracas. However, the price spike actually reflects current market conditions. High energy prices, which will affect every sector of the global economy, are likely to continue throughout the winter The only dependable method of attaining relief from high oil prices would be to increase production. Saudi Arabia announced in early July that it would unilaterally increase production by 500,000 barrels per day (bpd). However, according to the U.S. Energy Information Administration (EIA), Saudi production has only increased by 150,000 bpd. Since global demand tends to slacken in the autumn, OPEC will be reluctant to boost production. As well, individual members of OPEC have recently opposed increases; when Saudi Arabia announced its decision to boost production in July, it faced a solid wall of opposition. Consequently, the global economy faces a dual threat from flat supplies and diminished stocks. U.S. crude stocks are at a 24-year low. More importantly, low gasoline stocks in the United States and Europe are pushing refineries to favor gasoline production at the expense of heating oil. Last winter, heating oil stocks were already at a 10-year low. This winter, American and European deficits will be 50 percent and 20 percent worse, respectively, according to the International Energy Agency. Reflecting this crucial shortage, the price of U.S. heating oil hit a six-month high this week - and this near the end of the summer, when demand is generally at its lowest. ________________________________________________________________ Would you like to see full text? stratfor.com ___________________________________________________________________ These price crunches will lead to higher prices for other petroleum products, as well. Already, U.S. natural gas producers are expecting a 50 percent increase in prices this winter. Higher energy prices will hit every sector of the global economy, but the damage will not be uniform. In Europe, various energy taxes already constitute more than 80 percent of the price of gasoline. As a result, gasoline prices begin from a level about triple that of U.S. prices. An additional 30 cents on a $4 gallon of gasoline in London is not nearly as noticeable as an additional 30 cents on a $1.2 gallon of gasoline in New York. Europeans are also used to paying far more for natural gas, so again, the rising prices won't be shocking. The United States, with its preference for cheap energy, lacks this safety mechanism. Any increases in price will hit far harder in percentage terms. While the U.S. economy grew at an impressive 5.2 percent in the second quarter, higher energy prices could still trigger the inflation that Alan Greenspan fears. The United States' depleted energy reserves will only exacerbate this problem. But it is the developing world that will be the hardest hit. Oil demand in Asian states alone has already increased by almost 600,000 bpd in the first half of the year. And most Asian states lack substantial energy reserves or significant energy taxes. This all makes them far more susceptible to price shocks. Any rise in crude prices will directly impact their still-fragile economies. Unless OPEC agrees to a significant production increase during its September meeting - a highly unlikely event - the world will face sustained high prices and energy-induced inflation, especially in developing economies. _______________________________________________________________ For more on the Middle East & Africa, see: stratfor.com _______________________________________________________________ Editor's Note: The Weekly Analysis of Aug. 14, 2000 inaccurately depicted the size of the globe's population, which is 6 billion people. The error was made during editing. (c) 2000 Stratfor, Inc. _______________________________________________ SUBSCRIBE to the free, daily Global Intelligence Update. Click on stratfor.com UNSUBSCRIBE by clicking on stratfor.com _______________________________________________ Stratfor.com 504 Lavaca, Suite 1100 Austin, TX 78701 Phone: 512-583-5000 Fax: 512-583-5025 Internet: stratfor.com Email: info@stratfor.com