"Although the industry in aggregate is finding it difficult to stem production declines, Talisman's strategic positioning in the Foothills and in the deeper parts of the Basin continue to provide reserves and production growth. These results illustrate the potential rewards," said Dr. Jim Buckee, President and Chief Executive Officer. "We have established a North American natural gas production record for the Company of 870 mmcf/d, 6% above last year at this time. Talisman's realized North American natural gas prices have averaged about $8/mcf during the first quarter, more than double the level of a year ago. In total, Talisman expects to spend approximately $1 billion on North America exploration and development this year, over 80% directed at natural gas opportunities."
The Company has achieved a number of early drilling successes in its 2003 program at Monkman and the Alberta Foothills. In the Alberta Foothills, Talisman's natural gas production remains at near record levels, currently averaging between 125-130 mmcf/d, an increase of 9% from a year ago. The first two wells are currently tied in and on production at a combined raw gas rate of approximately 15 mmcf/d. The remaining four wells are in the process of being tied in.
Talisman has budgeted a record $132 million for the Alberta Foothills in 2003, including 23 wells (12.2 net). This includes funds for compression, pipelines and facilities to alleviate infrastructure limitations in the region. Activity is also at near record levels with five Talisman operated drilling rigs in the area.
Talisman is also addressing longer term infrastructure requirements with the Erith pipeline. The first phase of this project has received regulatory approval and will be commissioned in the fourth quarter of 2003. Upon completion of the second phase of the project, the pipeline will provide approximately 75 mmcf/d of raw gas capacity for area producers.
The Company's production guidance for 2003 is unchanged at 395,000-415,000 boe/d. Estimates for North America are 860-880 mmcf/d of natural gas and 58,000-60,000 bbls/d of oil and liquids.
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