Losses in UK Q1 Production by Talisman Offset by New Flows

Talisman Energy reported that production in the UK averaged 89,871 boe/d, down 25% from a year ago, primarily due to non-core asset sales. Production from continuing operations in the UK averaged 88,210 boe/d over the quarter, down 12% from the same period in 2007 and 13% from the fourth quarter 2007. Production decreased from 2007 primarily due to major planned annual maintenance shutdowns at Montrose/Arbroath, Buchan and Claymore, as well as an unplanned shutdown at Ross/Blake due to weather.

The reductions were partially offset by new production from Tweedsmuir and Enoch, which came onstream in the second quarter 2007 and from Duart and Blane, which came onstream in the third quarter of 2007.

First quarter unit operating costs of $29.01/boe were up 27% compared to the first quarter of 2007, due to planned shutdowns and disposal of the Brae assets. Unit operating costs are expected to decline significantly during the second half of 2008 as volumes increase, particularly at Tweedsmuir.

Tweedsmuir production increased over the fourth quarter of 2007 as the commissioning of Tweedsmuir progressed. Since the end of the first quarter, production rates of up to 30,000 boe/d have been achieved and full production is anticipated at the end of the second quarter.

Appraisal drilling was completed at Auk North in the quarter and planning for Auk North and Auk South development is continuing.

Appraisal drilling was completed on the Cayley discovery located in the Montrose/Arbroath area, west of the Montrose platform. The Company booked 21 mmboe of net probable reserves associated with the discovery at the end of 2007. Talisman has a 58.97% working interest in the field. Evaluation of development options and plans has started.


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