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

To: LARRY LARSON who wrote (9489)	1/31/2003 12:56:40 AM
From: LARRY LARSON	Read Replies (1) \| Respond to of 24925

Better piece: Talisman Says Wrapup of Sudan Sale Delayed Again By Jeffrey Jones CALGARY, Alberta (Reuters) - Talisman Energy Inc.'s $758-million sale of its stake in Sudan's major oil project to India's national oil company has been delayed a second time, raising questions over whether the deal will be completed as planned. In a statement late on Thursday, Talisman said the project's other partners had yet to approve the sale to India's Oil and Natural Gas Corp., meaning the expected closing day of Friday would not be met. But the company, which announced the sale of its 25-percent interest in the 250,000-barrel-a-day project in war-torn Sudan last October, said discussions with the Sudanese government and and the other partners were continuing and "substantial progress" was being made. "Since all requisite consents and approvals have not yet been obtained, the sale will not be completed by January 31 as previously anticipated," Canada's No. 2 oil explorer and producer said in the statement. Talisman stressed the Sudanese government had approved the deal in principle and had stated its support for ONGC, but company officials were not immediately available to comment on exactly what was holding the process up. The transaction, partly aimed at freeing Talisman from years of criticism from human rights groups and factions of the U.S. government over its involvement in Sudan, was first slated to close by the end of 2002, but Talisman said in late December that the approval process was taking longer than expected. RISKS OUTWEIGHED RETURNS Talisman's partners in the operating consortium, Greater Nile Petroleum Operating Co., include China National Petroleum Corp., Malaysia state oil firm Petronas and Sudan's Sudapet. Human rights and church groups have said Sudan's oil project was giving the Islamist government financial muscle to continue a two-decade civil war against mostly Christian and animist rebels in the African country's south. Talisman had maintained its presence there was a force for good, providing much-needed economic development and helping impoverished people by building hospitals and schools. But in announcing the sale last autumn, Talisman chief executive Jim Buckee said he concluded that the political risks, which had pressured the company's stock price, outweighed impressive financial returns. For its part, ONGC has been hunting for equity oil abroad to help energy-hungry India meet its huge oil and gas needs. Martin Molyneaux, analyst with FirstEnergy Capital Corp., put the odds of Talisman failing to sell the asset as "slim." However, with crude oil prices clinging to levels above $33 a barrel, the other partners could be considering whether they should exercise their rights of first refusal, Molyneaux said. "If CNPC and the Malaysians are of the view that oil's going to stay higher longer, then they should probably be exercising their right," he said. With sizzling crude markets, Talisman shareholders reap rewards from the sale of about 65,000 barrels oil output a day from the project as the process wears on, he said. Talisman shares closed up 81 Canadian cents at C$58.46 in Toronto on Thursday. The stock is up about 4 percent since it announced the sale. ($1=$1.53 Canadian). (C) Reuters Limited 2003.