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Talisman to reduce exposure to UK oil fields

TALISMAN has said it will further reduce its exposure to the UK North Sea although it increased production in the area in the second quarter.

The Canadian oil and gas firm told investors: "Proceeds from dispositions will continue to reduce corporate debt, maintaining a strong balance sheet as the company works to reduce its exposure to the North Sea and other non-core areas."

Talisman sold a 49 per cent stake in its UK North Sea business to Sinopec of China for around £1 billion in 2012.

The company said its share of share of production in the area was 19,500 barrels oil equivalent daily (Boed) in the three months to June, up 12 per cent from 17,000 Boed on the same period last year.

The increase was driven by the restart of production from the Claymore complex north east of Aberdeen in the first quarter.

In Norway production increased to 14,500 Boed in the quarter from 13,000 Boed in the same period last year.

However, the company said the netback or profit it made per barrel of North Sea production fell by an unspecified amount as a result of planned maintenance.

Talisman recorded charges totalling $62 million (£37 million) in respect of decomissioning liabilities in the UK and Norway.

The group recorded a loss of $9 million from operations, after making $79 million profit in the first quarter. It said the change was mainly due to lower North American gas prices, partially offset by higher sales of more valuable oil.

Last week Talisman said it had been approached by Repsol of Spain regarding various transactions, without giving details.

It added there was no assurance any transaction would be agreed.

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