Talisman's objective in North America is to become a leading, returns-focused shale producer. Talisman uses the term "shale" to refer to projects, plays or activities to extract natural gas and natural gas liquids from shale formations, which generally require stimulation techniques which are different than those associated with historically typical, or "conventional", oil and gas activities. The geographic areas in which Talisman's shale plays are located may also contain geological formations that are consistent with more conventional oil and gas extraction techniques or activities. Consistent with the strategic objectives noted in "General Development of the Business – Strategy" , management believes that these shale plays provide new and longer term growth opportunities for Talisman due to their material size and relatively low risk investment.
In 2010, the Company's North America operations concentrated on developing and piloting projects for its shale plays. In addition, Talisman continued to build its position in shale plays through land acquisitions and strategic partnerships. These partnerships include a joint venture with Statoil in the Eagle Ford shale play in Texas and a joint venture with Sasol Limited to develop the Farrell Creek assets in the Montney shale play in British Columbia.
Talisman intends to focus its spending in North America primarily on shale plays where Talisman has built significant landholdings. As part of its business strategy, Talisman will utilize its capital flexibility within its shale portfolio and maximize liquids investments, as well as develop promising liquids plays already in the existing conventional portfolio. Overall in North America, Talisman plans to spend approximately US$1.7 billion in 2011, with emphasis shifting to liquids rich opportunities, primarily in the Eagle Ford shale play, conventional oil properties and the Farrell Creek shale play. Talisman continues to review options for both strategic divestitures and acquisitions that would increase its focus on building significant liquids and shale projects. Talisman's North America operations are organized into two distinct businesses: Shale and Conventional.
