Talisman 2003 Corporate Responsibility Report

Commitment

Talisman supports the principles of, and will promote respect for, the Universal Declaration of Human Rights and we will lead by example, demonstrating values of tolerance and respect. We promote adherence to human rights principles in our areas of operation and will not be complicit in human rights abuses. We will advance best practices with host governments, partners and third parties consistent with our Security Policy, which has been revised in the spirit of the Voluntary Principles on Security and Human Rights.

When considering new international investments, we review associated potential human rights issues and their relationship to our operations. Talisman also liaises with stakeholders at an early stage of business activities to identify such issues.

Human Rights Training

T. Nigel D. Hares, Executive Vice President, Frontier and International Operations (right), helped officially reopen the Shendi Teaching Hospital in Sudan in September 2003.

Talisman supports specific training initiatives and projects that encourage the protection of human rights and support the goal of peace and security in operating areas affected by conflict. In 2003, we continued our involvement with the Pearson Peacekeeping Centre in Nova Scotia where two Talisman security personnel attended the “Free and Equal: Human Rights in Peace Operations” course. Course elements included operational imperatives of human rights in peace operations, international humanitarian law, and roles of civil police, military, government and NGO’s. Talisman has sponsored personnel attending courses at this world renowned centre since 2000.

Human Rights Advocacy and Dialogue
Regarding Colombia

Talisman continued to closely monitor human rights issues in Colombia in 2003 by engaging in advocacy and dialogue with organizations that are in a position to influence improvements in the area of human rights in Colombia. They include our oil and gas industry peers, the Government of Colombia (including the Colombian ambassadors to Canada and the United States) and non-governmental organizations such as Human Rights Watch and Amnesty International. We also support the work of the Colombia Taskforce at the Center for Strategic and International Studies in Washington, DC.

In June 2003, Talisman’s Senior Manager of Legal and Associate General Counsel and Manager of Corporate Responsibility both traveled to Colombia to provide a presentation to approximately 50 members of the Association of Colombian Oil Producers (ACP) on human rights and the provision of security for oil activities. Attendees of the presentation included representatives from many oil companies working in Colombia, as well as Ecopetrol (Colombia’s state oil company), the Ministry of Defense and the Presidential Office for Hydrocarbons.

During the presentation, “Enhancing Investor Confidence in the Provision of Public Security for Oil Operations in Colombia”, Talisman highlighted codes and principles that we consider to be international best practice in the area of human rights and security, including the U.N. Code of Conduct for Law Enforcement Officials, the U.N. Basic Principles on the Use of Force and Firearms and the Voluntary Principles on Security and Human Rights. Copies of these documents were provided to attendees in both Spanish and English.

Talisman recommended that international principles for public security should be implemented in Colombia in a transparent manner. We concluded the presentation by proposing a contractual template for the provision of security based on international principles.

Colombian Security Agreements

Talisman’s efforts in Colombia to advocate for the provision of security in the spirit of the Voluntary Principles on Security and Human Rights began in 2001. Since then, Talisman (Colombia) Oil and Gas Ltd. has developed and proposed a new security agreement structure between an operator, Ecopetrol (the state oil company) and the Colombian Ministry of Defense that clearly defines security roles as they relate to Talisman’s operations.

Talisman Supports the Global Compact
In 2000, United Nations Secretary General Kofi Annan formally launched the Global Compact, a network of companies, governments and non-governmental organizations, and labour who have agreed to work with the UN to support nine principles in the areas of human rights, labour and the environment.

Since the launch, Talisman has monitored developments in, and aligned corporate procedures with, the Global Compact’s principles. In February 2004, Talisman’s CEO Jim Buckee officially confirmed Talisman’s support for the Global Compact.

In his letter to Kofi Annan, Dr. Buckee committed “to make the Global Compact and its principles part of the strategy, culture and day-to-day operations of our Company . . .”

As a member of the Global Compact initiative, Talisman has also committed to reporting annually to our stakeholders on actions we have taken or lessons we have learned related to one or more of the nine principles. This commitment will be fulfilled through the discussion of our activities in our annual Corporate Responsibility reports.

For more information about how the Global Compact seeks to advance responsible corporate citizenship and ensure a more sustainable global economy through private sector partnerships, visit www.unglobalcompact.org.

In November 2003, thanks to great support from Ecopetrol, Sipetrol (our operating coventurer) and the Colombian government, Talisman established transparent agreements for the provision of security in our Acevedo, Huila Norte and Altamizal blocks (on which three exploration wells were being drilled). These agreements reference human rights law and stipulate that any support provided to the military will be used for non-lethal and defensive purposes only.

Corporate Responsibility and Public Policy Dialogue

In 2003, Talisman’s corporate responsibility group attended conferences, presentations and workshops led by academics and industry associations throughout North America. Further, we attended almost 70 meetings in both Canada and the United States, including meetings with the Canadian Department of Foreign Affairs and International Trade, Natural Resources Canada, United States Department of State and other government departments.

Other public policy efforts in 2003 included:
Talisman was a supporting sponsor of the National Corporate Social Responsibility Report initiative led by the Conference Board of Canada to establish common definitions, strategies and policies. The first report is scheduled to be published in the spring of 2004.

Talisman again supported the Center for Strategic and International Studies (CSIS) Colombia Project, an initiative which addresses issues related to human rights, the peace process and United States foreign policy towards Colombia.

Talisman participated in the Collaborative for Development Action, Inc. workshop on Corporate Engagement at Harvard University. Featuring 20 international participants from industry and government, the workshop focused on challenges that companies face when working in areas where social or political tensions persist and allowed participants to exchange experiences, determine benchmarks used in other settings and discuss strategy in dealing with corporate responsibility issues.

Amnesty International’s recommendations for Canadian resource companies operating in Colombia	Talisman’s assessment of its performance to date regarding Amnesty International’s recommendations
Ensure your organization has a detailed ethics policy governing your international operations or investments, with explicit language supporting human rights. This policy should be widely communicated within your organization and with partners and suppliers and should include mechanisms to ensure its implementation, monitoring and reporting.	As described in this report, Talisman has a Policy on Business Conduct and Ethics with specific language supporting the Universal Declaration of Human Rights and the Voluntary Principles on Security and Human Rights. The Company has implemented a compliance program to ensure monitoring and reporting of violations.
Insist on justice when human rights abuses occur that are in any way related to your operations or investments; this should include full and impartial investigations with those responsible brought to justice.	As a signatory to the International Code of Ethics for Canadian Business and a participant in the UN Global Compact, and as stated in the human rights section of our Policy on Business Conduct and Ethics, Talisman is committed to addressing human rights concerns within its sphere of influence. To date, we have not recorded any human rights abuses in Colombia related to our operations or investments.
Redouble your efforts to ensure that security provided for your people and your assets is ’clean’; triple-check the backgrounds of any people hired to provide security to ensure they do not have a history of human rights abuses.	In accordance with the Voluntary Principles on Security and Human Rights and our own Security Policy, we make strong efforts, using multiple sources where available, to ensure those hired to provide security conform to those standards.
Ensure that your company infrastructure (e.g. buildings, airstrips, roads, camps) is not used to facilitate human rights abuses.	All security agreements put in place with respect to our activities in Colombia reference human rights law and stipulate that any support provided to the military will be used for non-lethal and defensive purposes only.
Talk to each other and to other transnational operators and work together to develop ’best practices’ around security, community engagement and labour relations.	Talisman has discussed these issues with peer companies and the Government of Colombia, including a presentation provided to the Association of Colombian Petroleum Producers on the provision of security for oilfield operations, which recommended incorporation of the Voluntary Principles on Security and Human Rights into all security arrangements.
Convey to the Colombian government the urgency of complying with international recommendations to address the issue of paramilitary abuses.	We have advocated to the Colombian Government to respect human rights generally and implement international best practice for the provision of security for oilfield operations. To date, we have not recorded any paramilitary abuses related to our operations or investments and have not specifically raised the issue of paramilitary abuses with the Colombian Government.
In any opportunity to communicate with guerillas or armed opposition groups, press for an end to their abuses, the need to comply with international humanitarian law and the urgency for an all-party ’humanitarian accord’.	It is our policy not to communicate with guerrillas or armed opposition groups. In Colombia, we communicate strictly with the Government of Colombia and in the field, we communicate only with the leaders and members of the local communities impacted by our operations.
Convey the message that resource development companies do not desire — and will not tolerate — any ’cleansing’ or displacement of local populations from lands slated for development.	Our respect and support of human rights in Colombia has been communicated to the Colombian government and the local communities impacted by our operations. It is our corporate policy wherever we operate to not tolerate nor condone any human rights abuses of local populations for oil development.