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Gold/Mining/Energy : Lundin Oil (LOILY, LOILB Sweden) -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (2572)	6/23/2001 8:10:42 PM
From: Tomas	Respond to of 2742

Talisman secures Malaysian toehold - Speculation Sudan oilfield may be sold Calgary Herald, 22 June By Stephen Ewart Talisman Energy Inc. boosted its operations in Southeast Asia on Thursday by acquiring highly valued Malaysian assets from Lundin Oil AB in a two-part deal which also saw the Swedish company's properties in Libya go to Petro-Canada. In selling the bulk of its assets, Lundin will get $529 million from Talisman for operations in Malaysia, Vietnam, Papua New Guinea and the British North Sea, while Petro-Canada will pay $112 million for a stake in two Libyan oilfields. Lundin's operations in Russia and Sudan weren't part of the deal. Analysts praised Talisman for gaining a toehold in Malaysia that will boost production to up to 60,000 barrels of oil equivalent a day by 2004, while giving it a potential option in a sale of its lucrative-but-controversial Sudan oil project. "The real issue for Talisman is getting into Malaysia . . . it has the potential for being the size that Sudan is today," said Martin Molyneaux of FirstEnergy Capital Corp. Talisman has been condemned by church groups and human rights activists for providing oil dollars to the Muslim government of Sudan and helping escalate the long civil war with its largely Christian minorities. Talisman chief executive Jim Buckee has repeatedly said he wants to have another core operating area to provide production growth for the company before he sells the prolific oil basin in Sudan. Talisman, Canada's biggest oil and gas producer, already operates in Canada, the North Sea, Indonesia and Sudan. Lundin's existing production in the North Sea and the potential in Malaysia could replace the Sudan production, if Talisman decided to sell the African properties Buckee valued at close to $1.5 billion. With its Lundin acquisition, Talisman acquired stakes in operations in Southeast Asia with the Malaysian state oil company Petronas, which is also one of the partners in the Sudan project. Analysts quickly listed Petronas a potential buyer of Talisman's take in the project that came under scrutiny again last week when the U.S. House of Representatives moved to ban companies operating in Sudan from U.S. capital markets. Petronas is not publicly traded. "Petronas may or may not have been an opportunity to sell to before, but it would have been a straight cash deal and you might have got less," said Brian Prokop, an analyst at Peters & Co. "Now you have an opportunity . . . to swap volumes (of production) in Sudan for volumes in Indonesia." Prokop cautioned that a potential deal with Petronas may loom in the background, but it is the value of the current assets that drove the deal. Buckee listed the established reserves in the North Sea as an important ingredient in the deal, but he primarily focused on the opportunities to rapidly boost output in its growing Asian core area. "The key strategic driver for us is the very large upside in Malaysia," he said. "This acquisition fits Talisman's strategy of acquiring assets in the late exploration stages, prior to significant production." The properties produce about 3,000 BOE a day and Talisman expects to spend $350 million over the next four years to bring production to at least 50,000 BOE a day, or more if exploration proves successful. In its deal, Petro-Canada will get 25 per cent interest in two proven but undeveloped fields. The other 75 per cent interest is held by the Libyan government through the country's national oil company. Petro-Canada already operates in neighbouring Algeria. "This acquisition represents a logical and promising continuation of Petro-Canada's interest in North Africa," said Norm McIntyre, the oil company's executive vice-president. Talisman shares fell $2 to $58.70 on the Toronto Stock Exchange. Petro-Canada fell $2.30 to $39 in broad selloff of the sector. Lundin shareholders will vote in August on the deal that gives them $3.43 US cash and a stake in the new company with assets in Russia and Sudan. Photo text: Talisman Energy Inc. CEO Jim Buckee has secured another core operating area. The company is Canada's biggest oil and gas producer. calgaryherald.com