Talisman holds a 35% non-operated interest in Block 405a under a PSC with Algeria’s national oil company. Through its participation in Block 405a, Talisman currently holds a 35% interest in the Greater Menzel Lejmat North fields and the Menzel Lejmat Southeast field, a 2% interest in the unitized Ourhoud field, and a 9% interest in the unitized EMK field. Talisman has signed a Framework Agreement for the joint construction and operation of shared process facilities for the EMK field plus three other fields located in Block 208 (collectively, the ‘‘El Merk Project’’).

In 2010, Talisman participated in 15 development wells, with two further wells drilling over year-end 2010. In 2011, Talisman’s capital program in Algeria is expected to be approximately US$75 million and includes plans to participate in up to 19 development wells, including ten injectors. The El Merk Project was sanctioned in February 2009. The EMK field will be jointly developed with fields located in neighbouring Block 208. First oil is planned in the second half of 2012.