Sabah Oil and Gas Conference 2014 Talisman Malaysia Increasing Growth Opportunities for Sabah May 26 th, 2014

Sabah Oil and Gas Conference 2014

Talisman Malaysia

Increasing Growth Opportunities for Sabah

May 26th, 2014

Content

Overview of Talisman Energy

Sabah Growth Strategy

Securing a Foundation

Maximising Asset Recovery

Expanding through Exploration

Working with other Operators

3NYSE : TLM | TSX : TLM www.talisman-energy.com

Talisman Energy Global OperationsTwo Core Regions : The Americas and Asia-Pacific

• 2014 production guidance 350-365 mboe/d

– Core areas 324-334 mboe/d

– Other 26-31 mboe/d

Other areas – considering alloptions

• UK – Sinopec deal lowers exposure• Norway – sales process underway• Kurdistan – Kurdamir and Topkhana

appraisal ongoing

Other areas – considering alloptions

• UK – Sinopec deal lowers exposure• Norway – sales process underway• Kurdistan – Kurdamir and Topkhana

appraisal ongoing

Core: Asia-Pacific• Generating free cash flow,

near-term exploration potential• Long life assets with high

netbacks

Core: Asia-Pacific• Generating free cash flow,

near-term exploration potential• Long life assets with high

netbacks

Core: Americas• Resource plays provide

long-term growth• Colombia – exploration and

development underway

Core: Americas• Resource plays provide

long-term growth• Colombia – exploration and

development underway

• 2013 2P reserves ~1640 mmboe

− Core areas ~1480 mmboe

− Other ~160 mmboe


Talisman Energy - Asia PacificA Core Talisman Region

Core areas

Additional Assets

Exploration

South SumatraSouth Sumatra

Malay BasinMalay Basin Sabah Basin

TangguhTangguh

0 500 1,000 1,500Km

Kitan/LamCorKitan/LamCor

VietnamNam Con Son

VietnamNam Con Son

VietnamHST/HSD

VietnamHST/HSD

Papua New Guinea


Vietnam

PeninsularMalaysia

Sarawak

Sabah

Talisman Energy in MalaysiaAssets Overview

Malaysia

TLM block

Oil field

Gas field

SB309 & SB310 (70% WI)Gross exploration acreage 13,000 km2

3-4 well exploration program planned in 2014

Kinabalu (60% WI)Operated effective 26 Dec 2012

Successful completion of 3 infill wellsCommencing redevelopment

PM-3 CAA (41% WI)Unique cross-border development

Supplying gas to two nationsTalisman’s largest operated asset

Finalizing PSC extension

PM305 & PM314 (60% WI)SAA – about 85% recovery to dateStudying options to extend field life


SabahNew Core Area anchored by Kinabalu

Kinabalu is a secure base with upside recovery opportunities

Significant acreage in a prolific and proven hydrocarbon province

Extensive infrastructure enhances exploration monetization opportunities for oil and gas

Potential Synergies with other operators to optimise operation and Development Plans


Block: SB1 Kinabalu

2012 Kinabalu Oil PSC:

Start Date: Dec 2012 (20 years license)

Operator: TLM (60%)

Partner: PETRONAS Carigali (40%)

Location

55 km NW of Labuan

28 km SW of Samarang

2 km SE of KNAG

Field Water Depth: 56 m

Discovery: 1989 and First Oil: Dec 1997

Cum. Oil Production @1/1/14 = 97 MMstb

20 Development Wells (20 active strings)

Kinabalu – Location Map Kinabalu – Block Details

LabuanLCOT (SHELL)

Samarang Complex (PCSB*)

Kinabalu KNDP-A

KNAG(PCSB)

2012 Kinabalu Oil PSC Overview

First PSC handover to International Operator

First progressive volume PSC to encourage brownfield redevelopment

First infill well : 9 months following transfer of operatorship

Redevelopment project, Concept Selection : 10 months following transfer of operatorship


Well interventions

Six Infill wells approved

Double Field Production within one year

New Platform New Facilities Additional Infill

Drilling Secondary Oil

Recovery

Exploration Success

Potential Synergies with PETRONAS Carigali in Sabah

Improve the HSE Performance

Improve Field Reliability

Existing Platform Debottlenecking Project to be completed in Q4 2014.

2012 Kinabalu Oil PSCGrowth Strategy

LP Separator KN 114st

Within Talisman Corporate Responsibility Standards


Managing Aging InfrastructureIt starts at the beginning

Additional Escape RouteCrane serviced and recertified for man-ridingHelideck Lighting Installation

Management of Change

Training & Competency

DESIGN CONSTRUCT

INSPECT

EMERGENCY RESPONSE

IDENTIFY HAZARDS

OPERATE

MAINTAIN

Cessation of Production Operations

Decommission

VERIFY


Facilities Debottlenecking

Initial Infill Drilling programme and well interventions increasing fluids throughput

Restrictions in liquid export rates

Preparation for additional offtake rates once the full field redevelopment project is implemented

Facilities DebottleneckingReady for Future Growth

Liquid Production Increase

Remove produced water prior to exportConvert LP Separator to 3 Phases

Equipment Integrity Improvement

Install Online Sand Removal System

Gas Production Increase

Modify LP Compressor to increase its capacity to minimize flaring.


Field RejuvenationMaximising use of Existing Slots

Well 6 Well 1

Well 2

Well 4Well 3

Well 5

# 4

# 3

# 5

# 1

# 6# 2

East Fault Block

Main Fault Block

Note: All Wells Are Projected


Field RejuvenationDrilling Performance to date

No Recordable Incidents (LTI, RWI, MTI)

Excellent operational performance - benefit of established Rig Contractor (20+ years in Malaysia)

Continuity of activity in Sabah – Key to Performance

0

5

10

15

20

0

20

40

60

80

Well 1 Well 2 Well 3 Well 4

NP

T (

%)

Day

s

Days Planned Days Actual NPT Actual

0

10

20

30

40

50

Well 1 Well 2 Well 3 Well 4

Co

st (

US

$MM

)

Planned Costs Actual Costs


Kinabalu RedevelopmentMaximising Recovery Factor

A Team Approach : Project Success is driven by the Integration of all Disciplines

Consider Novel ‘Cost/Schedule Saving’ Schemes ‘No Stone Unturned’


Kinabalu RedevelopmentSelected Concept Overview

Stage 1 (Early Production)

Stage 2 (Full Production)

Scope

• Installation of a 20 slot wellhead platform (WHP) bridge linked to KNDP-A.

• Maximum Use of Existing KNDP-A

• Installation of a new CPP bridge linked to the new WHP

• Gas Compression & Water Injection

Estimated 1st Oil

4Q 20164Q 2017

(Estimated 1st Injection)

Two Stage Development Secondary Recovery Implementation Increase field recovery factor to ~ 40%

New Well Head Platform


Exploration PortfolioSB310 & SB309 Prospects and Leads

Partners: TML (70%), PCSB (30%) PSC Signed; Effective Date - 26th

October 2009 Exploration period: 6 years 5 Commitment wells in SB310; 3 wells

in SB309


South Sabah SynergiesA way of working between Operators

KNNAG accommodation Helicopter Sharing Marine Vessels Spare Sharing Subsurface Data Sharing 5 Year Integrated Plans Warehousing

Facilities optimization with KN and Samarang

Gas utilization Liquid handling

Debottlenecking

Area Development Plans Maximise Utilisation of

Existing Infrastructure


Our ThemesEducationHealth Environment

Corporate Responsibility within TalismanSupporting our Growth Plans


Thank You

Documents

Sabah Oil and Gas Conference 2014 Talisman Malaysia Increasing Growth Opportunities for Sabah May 26 th, 2014