May 09, 2007 --- Vol. 13, No. 42May 2007

All 3 Talisman 2006-07 NPR-A wells hit pay, 300-400M barrels

All three of Talisman Energy’s exploration wells in the National Petroleum Reserve-Alaska encountered hydrocarbon-bearing sandstones in several formations, the company said in a press release May 9. The wells are in the northwest planning area of NPR-A and were part of Talisman subsidiary FEX’s 2006-07 winter drilling season on drill sites 60 miles southeast of Barrow.

One well was plugged and abandoned and two were suspended, Talisman said. The company said the “initial estimate of contingent resources present” in the formations of the two suspended wells was “300-400 million barrels” net to FEX, which has a 60 to 80 working interest in the leases. Petro-Canada’s Alaska subsidiary holds the remaining working interest.

In addition to the 300-400 million barrels, Talisman said “there is significant follow-up potential on many similar structures on Talisman's acreage if commercial productivity is proven.”

The announcement was based on log analysis and “strong gas and oil shows, including oil staining and free oil in the drilling mud in one of the wells,” the company said. The two wells encountered more than 225 feet of net hydrocarbon bearing sandstones. FEX plans are to evaluate them next season, the winter drilling season of 2007-08.

“I am very encouraged by the results of our winter drilling program in Alaska, although disappointed that we did not have time to test the wells,” said Jim Buckee, Talisman president and CEO. “The presence of black oil on the shakers is very positive as it confirms the presence of mobile oil as opposed to gas.”

Although the well that was plugged and abandoned encountered hydrocarbon-bearing sandstones, FEX believed the well would be “subcommercial given current infrastructure.” The company said “recently acquired high-fold seismic” will be used to analyze the well.

“A shortened winter drilling season due to the delay in tundra opening, and the need to demobilize equipment before the tundra started thawing, precluded flow testing this year. Formation evaluation will continue when longer-term test equipment is mobilized to the field area,” Talisman said.

The two rigs used to drill the three wells, Doyon Akita Arctic Wolf No. 1 and Nabors 14E drilling rig, and other equipment has been demobilized to the Cape Simpson Industrial Port on the Beaufort Sea coast. The industrial site is operated by Ukpeagvik Inupiat Corp.

Both Talisman and Petro-Canada are based in Calgary.

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