Talisman Energy (NYSE:TLM) has a diverse set of oil and gas assets in its global portfolio, including properties in North America, Southeast Asia and the North Sea. The company is looking to leverage these operations to grow crude oil and liquids production by 5% to 10% annually through 2015.

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Production Growth
Talisman Energy was producing about 230,000 barrels of oil equivalent (BOE) per day of crude oil and other liquids at the end of 2011, and is attempting to increase this to 300,000 BOE per day by 2015. The company plans to develop various shale plays in North America, including the Eagle Ford Shale and Duvernay Shale. Talisman Energy is also targeting a number of other areas in Southeast Asia, Colombia and the North Sea to generate this growth.

SEE: What Determines Oil Prices?

Dry Gas Cuts
Talisman Energy has made major adjustments to its capital program as a response to low natural gas prices. The company plans to spend $3.6 billion in 2012, a $900 million reduction from 2011. The overwhelming majority of this capital will be directed towards oil and liquids development, with only $200 million devoted towards dry gas development during the year. The company is also divesting assets and has sold $1 billion of properties in 2012.

This reduction in spending is demonstrated in the company's Marcellus Shale operations over the last few years. Talisman Energy is now operating only one rig here, down from 11 at the beginning of 2012. Capital spending in this play in 2012 has been reduced to a range between $300 million and $400 million, down from nearly $1.2 billion in 2011.

Eagle Ford Shale
Talisman Energy has 80,000 net acres exposed to the Eagle Ford Shale, with the leasehold spread over the dry and wet gas windows of the play. The company estimates that production from here will range from 12,000 to 17,000 BOE per day in 2012.

Talisman Energy has budgeted $600 million in net capital for the Eagle Ford Shale and expects production to reach as much as 70,000 to 80,000 BOE per day in just a few years.

SEE: Oil And Gas Industry Primer

Duvernay Shale
Talisman Energy is also working to develop the Duvernay Shale in Alberta, Canada, where the company has approximately 360,000 net acres under lease. The company plans to have six wells drilled here by the end of 2012, in both the Southern and Northern portions of its leasehold. Talisman Energy is optimistic that the Duvernay Shale will add materially to liquids production for the company in the long term.

Encana (NYSE:ECA) has 370,000 net acres exposed to the Duvernay Shale and is operating two rigs here. The company has completed three horizontal wells into this play and is currently analyzing the results of these wells.

Canadian Natural Resources (NYSE:CNQ) has 385,000 net acres and said that it would drill one well into this play to prove up the acreage.

Chevron (NYSE:CVX) is also starting up development of the Duvernay Shale and has drilled three wells into this play to date. The company indicated in a recent conference call that it was "encouraged" by the results of these wells.

SEE: A Guide To Investing In Oil Markets

The Bottom Line
Talisman Energy has assembled a wide range of oil and gas assets, which it will use to grow crude oil and liquids production, while deferring as much development as possible on its substantial base of natural gas properties.

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At the time of writing, Eric Fox did not own shares in any of the companies mentioned in this article.

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