Talisman boosts land holdings

Gary Park

Petroleum News Calgary correspondent

The bullish view of the Appalachian region by Canadian independent Talisman Energy has been reinforced by a US$65 million purchase of 475,000 gross acres of Trenton/Black River rights throughout the region. The Calgary-based company announced June 29 that its U.S. subsidiary, Fortuna Energy, had acquired all of Belden & Blake Corp.’s assets in New York, Ohio and West Virginia. Fortuna currently holds 433,000 acres in the region.

The deal will also give Fortuna about 4-5 million cubic feet per day of production, a volume it expects to double over the next three months.

“The key to this transaction is the highly prospective land position,” said Talisman President and Chief Executive Officer Jim Buckee. He said the added production will increase Fortuna’s output to 110-120 million cubic feet per day, with the company’s latest well testing at 15 million cubic feet per day.

Talisman entered 2004 with plans to spend $60 million in the Eastern United States, drilling 21 wells.

Buckee views Appalachia as a growing core area for the company after paying US$250 million in late 2002 to acquire a foothold in the area.

Although gas has been extracted from the play over many years, deeper drilling is expanding the horizons.

Fortuna has already identified 25 drilling locations in its new properties and expects to add more after a technical review, adding to its current 40 locations.