Oil & Gas

GDF Suez linked to possible takeover bid for Talisman

Industry news

Talisman Energy and its UK North Sea interests could end up under French ownership, it has emerged.

Paris-based GDF Suez, whose UK exploration and production arm is operator of the Cygnus and Juliet gas fields in the southern North Sea and also has interests in the central North Sea and west of Shetland, is reportedly mulling a fresh takeover approach for Canada’s Talisman.

Talisman owns 51% of a North Sea joint-venture with China’s Sinopec, a partnership employing about 3,000 people either directly or indirectly through contracts.

Talisman Sinopec Energy UK operates nine offshore platforms, two floating facilities and an onshore terminal at Flotta in Orkney.

Calgary-based Talisman Energy has been trying to shed assets, particularly those not in line with its long-term growth plan, to focus on core operations in western Canada, the US, south-east Asia and the UK North Sea.

It is thought it still hopes to shed some of its assets to Spanish oil producer Repsol, which earlier this year announced its interest in buying the whole business.

Repsol later dropped its Talisman takeover plans, having previously identified the US, Canada, Norway and some other countries as targets for potential deals as it looked for ways to spend £3billion in compensation it received through the nationalisation of energy assets in Argentina.

GDF Suez is now believed to be interested in buying some of Talisman’s assets or potentially the group in its entirety.

Bankers from financial advisory and asset management company Lazard are said to be working on a possible deal.

GDF Suez reportedly made an offer for Talisman last year, though this was denied by the French firm’s management.

Talisman and GDF Suez were both unavailable for comment yesterday.

GDF aims to produce first gas from Cygnus, which is said to be the largest gas find in the UK’s southern basin for 25 years, in late 2015.

The Cygnus Alpha wellhead topsides sailed from Heerema Group’s Hartlepool yard in May and the remaining infrastructure is expected to arrive on site around April.

Cygnus has estimated proven and probable reserves of 110million barrels of oil equivalent, and its peak production is forecast to contribute 5% to the UK’s total gas output.

GDF Suez has a 38.75% stake, with partners Centrica and Bayerngas holding interests of 48.75% and 12.5% respectively.

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