Local Benefits

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Talisman (UK) supported 55 education, youth and health programs in 2005, including Quizdom, which is shown here.

HOW DOES TALISMAN'S 'INVESTING IN OUR COMMUNITIES' PROGRAM WORK?

Talisman's 'Investing in our Communities' program is an important component of the Company's overall corporate contributions strategy. This employee-based program helps employees support organizations and causes that do not normally fall within the corporate contributions program. The program provides up to $200 to organizations that full-time employees and their families volunteer with, such as little league teams and community and school fundraisers. In all, Talisman received 208 employee requests for funding and invested approximately $41,600 through the program last year. In 2006, Talisman will expand its program across its global operations to further encourage all employees to become involved in the communities where they live and work.

Talisman's Approach to Corporate Contributions

Talisman believes that investing in the communities where we live and work supports our business activities. Corporate contributions play an important role in risk mitigation, helping to ensure the Company's licence to operate, improving community relations, reducing security risk, assisting in employee recruitment and retention and generating goodwill with home and host governments. In 2005, Talisman invested approximately $5.5 million in community development initiatives in both operated and larger non-operated international projects (Indonesia, Algeria, Colombia and Peru).

Canadian Community Investment

In 2005, Talisman contributed approximately $3 million to support health and welfare, the arts, education, the environment and community causes in Canada through 671 community development programs. Talisman continued to support Calgary's United Way campaign, providing a record $820,000 through employee donations, a corporate match and numerous fundraising activities.

Canadian Operations Invest Locally

Talisman's Canadian operating areas contribute to programs that will benefit their local communities. In 2005, Talisman invested more than $360,000 in support of several projects, including a heart monitor at the District Hospital in Chetwynd, BC, the Grade 5 Students Greenwing Program in partnership with Ducks Unlimited in Edson and Grande Prairie, Alberta; and the Neonatal Intensive Care Unit at the Queen Elizabeth II Hospital in Grande Prairie, Alberta.

In October 2005, Talisman's Edson operations were officially recognized by the business community as the "Corporate Partner of the Year". This honour is a clear recognition of Talisman's overall strategic efforts towards being a welcome member in the community.

Supporting the Canadian Museum of Nature

Talisman has agreed to become the title sponsor of the Canadian Museum of Nature's new signature gallery at the Victoria Memorial Museum Building in Ottawa, at a cost of $2 million over five years. The "Talisman Energy Fossil Gallery" will open in October 2006 and will examine the period of environmental change that marked the end of the age of dinosaurs. In addition to the world-class gallery, a variety of educational resources will be created to expand the reach of the exhibit beyond museum visitors, including teachers' resource kits, the museum website, a CD-ROM, and a travelling exhibition.

Supporting Post-Secondary Education

Talisman established 10-year scholarship commitments at the University of Calgary ($200,000 annually) and the University of Alberta ($100,000 annually). The scholarships are offered in the faculties of Engineering, Science, Business and Law.

In October 2005, Talisman and other industry peers helped establish the BC Oil and Gas Centre of Excellence at Northern Lights College in Fort St. John. The Centre will offer an Oil and Gas Rig Technician apprenticeship training program for new and existing rig workers.

Talisman operates in remote locations and in difficult terrain.

Talisman donated two global positioning system (GPS) units to Chetwynd, BC's Ambulance Service in July 2005. Since Chetwynd's surrounding area has many hundreds of kilometres of forest service roads, the GPS units are an invaluable tool to find specific oil, gas, logging and other industrial work sites, allowing emergency response teams to pinpoint positions precisely. This is of utmost importance if secondary help, such as a helicopter, is needed to transfer critical patients or fire-rescue crews if power equipment is needed to free somebody trapped in a vehicle.

I'm convinced that, sooner or later, the use of these GPS units will help us save somebody's life by getting the help where it is needed quicker. Minutes and seconds count in our line of work and for this reason I thank you again for the donation of these units.

Markus Ulrich, Paramedic Chief 852 Station, Chetwynd, British Columbia

United Kingdom

Talisman (UK) contributed approximately $570,000 in support of 55 community programs in education, youth and health, including the Scottish Executive's Determined to Succeed (DTS) initiative. The DTS forges relationships between businesses, teachers and local authorities to help Scotland's young people develop self-confidence, self-reliance and ambition to achieve their goals in work and in life. Through the DTS scheme, Talisman (UK) supported several initiatives with Ferryhill Primary School, school talks at St. Machar and Gilcomstoun Primary Schools, the Kirkhill School Business Breakfast and Primary School Booklets. Talisman UK will expand its commitment to the DTS scheme in 2006.

Talisman (UK) also supports community development programs through its Flotta Terminal in the Orkney Islands. In 2005, Talisman (UK) supported 30 projects and additional "in-kind" assistance programs, including various health projects, school programs and sports and cultural activities.

Major projects included sponsorship of the Voluntary Action Orkney, which assists local welfare organizations and Orkney Careers for respite care and advice for those who care for disabled or elderly relatives at home. Talisman also sponsored a concert during the six-day St. Magnus Festival involving the Scottish Symphony Orchestra. Additional funding was provided to the Kirkwall Grammar School Drama and Music group to assist with costs for their Calgary concert. Talisman (UK) also contributed to several environmental programs in 2005, which are described on pages 27-28.

Indonesia

Talisman contributed $395,000 in support of community programs in operated and non-operated areas in Indonesia focusing on education, economic empowerment and social/infrastructure contributions. The Ogan Komering operation continued its support of national sports week, the improvement of regional infrastructure and provided school supplies to local children. Other projects included a rubber tree plantation and fish farm, scientific essay competition, medical programs, teachers' honorariums, university scholarships, farming assistance and construction of schools. These programs increase the capacity of the local area and promote greater independence for local residents.

Trinidad and Tobago

Talisman (Trinidad) provided approximately $502,000 throughout its operating areas in support of community programs. In the Eastern Block, Talisman (Trinidad) worked with a Calgary-based organization, industry partners and regional government to establish a refurbished play park in Rio Claro. Talisman (Trinidad) employees assisted with the project and volunteered during the commemoration. Talisman (Trinidad) also worked with the Canadian High Commission in Trinidad to upgrade a school for special needs children.

Funding was also provided by Talisman (Trinidad) though its co-venturer to partner with the Ministry of Agriculture to train 39 local farmers in cultivation. A follow-up program was based on the rearing of livestock, which attracted 50 farmers and was facilitated by the Ministry of Agriculture Land and Marine Resources.

Talisman (Trinidad) contributed US$60,000 to the University of West Indies Geosciences Department as part of a multi-year commitment. Talisman (Trinidad) co-funded a baseline information study conducted by the University of West Indies to develop a social baseline of the southeastern portion of Trinidad with detailed information in the areas of health, education and agriculture. The baseline will enable Talisman (Trinidad) to conduct its future community development activities more effectively.

New York State

Fortuna contributed approximately $233,000 throughout its Appalachian operations. Three significant programs highlighted Fortuna's investments, including a contribution to local charities for families needing help with utility payments, support to local fire departments for rescue equipment, and support to supplement equipment for earth science and other classes for local schools. Grass roots funding continued to be directed towards area educational institutes, the Red Cross, the United Way, the local food bank, nature and science centres and other organizations.

Sudan

As part of its exit strategy from Sudan, Talisman provided approximately $389,000 in 2005 for the continuation of three core programs in Sudan: a model farm, an agriculture capacity building program, and an adult learning program which includes vocational training. The model farm and agriculture program provide food security, improved agriculture training and a source of village income, derived from the sale of crops and animals. The agriculture program provides ploughing and seeding of approximately 12,000 acres in Unity State, in the Nuba Mountains in South Kordofan state. The output is split amongst villagers and a community fund that can be used as needed for the mutual benefit of the village. Cost sharing from the communities has risen to the point where the program should be self-sufficient in 2006. The Adult Learning Program has provided basic skills in reading and writing. Participants have stepped into the vocational program, which provides skills in electrical, mechanical, carpentry and soap-making.

Talisman employees worldwide were deeply affected by the tsunami tragedy.

Talisman and its employees responded generously to requests for aid as a result of the tsunami tragedy in Southeast Asia. Through several of our international offices, Talisman provided approximately $550,000 including $150,000 from employees, to organizations helping with tsunami relief and rebuilding in Southeast Asia. Talisman matched employee contributions dollar for dollar. To support longer-term rebuilding efforts, Talisman has partnered with Samaritan's Purse International Relief and the United Nations Development Program to establish a vocational training centre for women and an outreach program in West Aceh, Indonesia. The centre provides a variety of support services to Acehnese women, like Kartini (below), including sewing and cooking studios and a trauma counselling centre. Talisman also supports the Soroptimist International of Jakarta in the reconstruction of Lamreh village, located about 40 kilometres northeast of Banda Aceh. Approximately 200 Lamreh village families were left homeless after the tsunami and the general infrastructure, including the local school, were destroyed. Since then, the primary school was rebuilt and opened to students in August 2005 and the construction of 101 homes was largely completed by the end of 2005.

I sew in this studio in order to temporarily get away from the tent. Sewing in the studio helps ease my trauma.

Kartini, Resident of Meulaboh, West Aceh, who lost her husband and a son to the tsunami.