Canadian energy explorer
Talisman Energy Inc.
) offered a glimpse of its 2013 capital spending plans. The
Calgary, Alberta-based oil and gas player said that it will
reduce capital expenditures by about $1 billion in 2013, as it
focuses on unlocking value through asset sale/joint venture
partnerships and grow production from promising liquids rich
areas in the Americas and Asia-Pacific.
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Talisman - that sold a major portion of its North Sea operations
last year to Chinese refining giant
) for $1.5 billion - has pegged its 2013 capital budget at about
$3 billion, down 25% from the $4 billion it invested last year.
Of the total, roughly 90% will go toward liquids and
international gas projects.
At the same time, Talisman disclosed that it is examining $2-$3
billion in non-core asset divestitures or joint ventures over the
next year and half. The expected proceeds from the property sale
- including those in the Montney and northern Duvernay formations
in Western Canada - is likely to be used for debt reduction,
finance short-term development plans and buy back
Talisman, that has struggled to cope with low North American
natural gas prices, also said that it expects its annual
production to be in the range of 375-395 thousand oil-equivalent
barrels per day (MBOE/d). The company guided towards liquids
volume accounting for approximately 40% of the total output in
2013 (up from 35% in 2012), while international gas is supposed
to make up a fourth of the total. Cash flow for the year is
expected at around $2.5 billion.
Talisman currently carries a Zacks Rank #3 (Hold), implying that
it is expected to perform in line with the broader U.S. equity
market over the next one to three months.
Meanwhile, one can look at other Canadian upstream operators like
ARC Resources Ltd.
) as attractive investments. Both these firms - sporting a Zacks
Rank #1 (Strong Buy) - offer value and are worth accumulating at