Talisman CEO John ManzoniJeff McIntosh
Talisman Energy Inc. will sell a number of non-core assets in Canada through five separate transactions for a total of $1.9-billion, the Calgary-based company announced Wednesday.
The oil and gas producer, which had already announced in January that it would be selling non-core assets as it shifts its North American focus to shale gas formations, said it has buyers for properties in Ontario and Western Canada.
The transactions include one million acres - just over 400,000 hectares - in the Peace River Arch area near the northern borders of Alberta and British Columbia.
Talisman is also selling properties in the central Alberta Foothills region and near Hinton, Alta., as part of the overall sale of assets expected to be completed by end of June.
Talisman's president and chief executive, John Manzoni, said the sales will help the company focus on building its North American shale gas business.
"Although these are excellent assets with a great future, they can't effectively compete for capital within our emerging strategic asset mix," Mr. Manzoni said in a statement.
The assets being sold currently produce the equivalent of 42,500 barrels of oil per day, although about 90 per cent of it is comprised of natural gas.
The lands also have net proven reserves of equivalent to 120 million barrels.
Talisman has been one of Canada's biggest players in shale gas, a resource that was too difficult and costly to develop until the advent of technologies like horizontal drilling and multi-stage rock fracturing.
Talisman's main shale gas holdings are in northeastern British Columbia and in the Marcellus formation, which stretches over parts of New York, Pennsylvania, Ohio and West Virginia.
Other key areas for Talisman are southeastern Asia and its offshore wells in the North Sea between the United Kingdom and continental Europe.
Energy stocks led decliners Wednesday morning on the Toronto Stock Exchange as crude oil dropped 95 cents to $85.90 (U.S.) a barrel after the U.S. Department of Energy reported a sharp rise in crude inventories last week.
Talisman stock was down 45 cents or 2.5 per cent at $17.38 in late morning trading Wednesday on the TSX, with more than 1.7 million shares traded.