Talisman Energy Inc. (TLM)

[Enterprising Investor]

Talisman Energy and Statoil reverse course on South Texas sale, media reports (7/10/14)

Talisman Energy Inc. and Statoil ASA have scrapped plans to sell their joint venture in the Eagle Ford Shale after it attracted lower-than-expected bids, wire service Bloomberg reports, citing people familiar with the matter.

The companies were seeking as much as $4 billion for the 50-50 partnership, according to Bloomberg, which says its sources asked not to be identified because the matter is not public. Bids fell short in part because the venture produces especially light condensate rather than pricier crude oil, according to the story.

A spokesman for Canada-based Talisman declined comment on the report. He also declined to say whether the company had solicited bids for its South Texas holdings.

"We don't comment on rumor and speculation," Talisman spokesman Brent Anderson says.

Officials with Statoil, based in Norway, were unavailable for comment at press time.

Talisman said in March it plans to sell $2 billion of assets in 18 months so it can focus on a smaller number of areas. This month, it announced plans to unload Australian operations.

Speculation swirled last year that Talisman wanted to put its Eagle Ford holdings on the sales block for us much as $2 billion and that it was working through the Royal Bank of Canada to find a buyer. The company owns 74,000 acres in South Texas, where it maintains the venture with Statoil.

The two companies have been partners in the venture since 2010, Talisman spokesman Anderson confirmed.

Recent Eagle Ford asset sales have generated big returns as energy companies look to expand in the thriving, oil-rich play and as early investors look to cash out.

In February, Oklahoma's Devon Energy Corp. dropped $6 billion to buy GeoSouthern Energy's Eagle Ford acreage in a bid to boost oil production. And earlier this summer, Houston’s Sanchez Energy Corp. announced plans to buy energy giant Royal Dutch Shell Plc’s Eagle Ford acreage for $639 million.

http://www.bizjournals.com/sanantonio/blog/eagle-ford-shale-insight/2014/07/talisman-energy-and-statoil-reverse-course-on.html?page=all