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Libya intriguing, Iraq not Nexen interested in Libya; Talisman sees potential in Libya, dubious about Iraq Gary Park Petroleum News Calgary Correspondent
Canada’s most daring foreign petroleum adventurers are sizing up two global hotspots as they look for alternatives to maturing North American oil and gas basins.
Nexen, which has relied on Yemen for more than half its production over the last decade, is intrigued by Libya and moderately interested in Iraq and Talisman Energy has Libya on its horizon.
With the environment “changing dramatically” in Libya as U.S. sanctions on the former rogue state are easing, Nexen is “broadly interested” in the region, said Chief Executive Officer Charlie Fischer.
Talisman Chief Executive Officer Jim Buckee said his company also sees great potential in Libya, but gaining a foothold in the North African country is a long way off.
“Even if we get the go-ahead (for Libya), it’s to negotiate,” he said. “Nothing is signed. It’s a fairly remote possibility.”
The men spoke at their companies’ annual meetings in Calgary, both held May 4.
Buckee had earlier been reported in the Globe and Mail as saying Talisman was trying to “get signatures on a number of exploration blocks” to gain entry to Libya. Iraq more distant for Nexen Iraq is a more distant prospect for Nexen, which indicated last year that it could parlay its Yemen experience to help rebuild the war-damaged oil industry.
“Our time frame on that opportunity has certainly lengthened because of all the issues that we see in Iraq,” said Fischer.
“It was never our intention to go into Iraq on a remediation basis. We wanted to go in on an exploration basis or a development basis.”
He said it is “obvious the world has not unfolded (in Iraq) as the Americans had hoped and right now it appears, looking in from the outside, to be a bit of a quagmire.”
Fischer said Nexen’s view is to remain patient. “The reserves aren’t going to go away.”
For now, Yemen is a vital element of the Nexen portfolio, contributing 114,000 bpd to total output of 258,000 bpd, with a number of projects under way to maintain that level.
Fischer said he has no concerns about anti-Western feelings affecting Nexen’s operations in Yemen, where its good reputation has helped its entry into Nigeria and its chances of exploiting recoverable resources of about 500 million barrels in the offshore Usan field. Buckee still challenged over Sudan Buckee, who gained notoriety for clinging to a stake in Sudan against mounting human rights opposition, is similarly dubious about Iraq.
He said it is “not a reasonable risk at the moment” because there is no clarity on who would grant title to oil properties.
It’s almost a year since Talisman exited Sudan, selling production of 60,000 barrels of oil equivalent per day to India’s ONG Videsh.
But it can’t shake off the protesters, who challenged Buckee at the annual meeting to say he was wrong to enter the war-torn country in the first place and demanding compensation for those displaced by the Greater Nile oil project.
Buckee refused to bend, insisting the plight of Sudan has remained unchanged since Talisman’s departure, while Talisman was continuing its “corporate responsibility” in Sudan despite its pull-out.
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