Talisman Energy posts profit, cuts dry gas spending

Tue May 1, 2012 6:44am EDT
 
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(Reuters) - Canadian oil and gas producer Talisman Energy Inc TLM.TO reported a first-quarter profit on higher production of liquids from Southeast Asia and North American shales, but it cut capital spending plans again as gas prices remain weak.

Talisman, which reported a loss in the year-earlier quarter, has been building up assets in oil and liquids-rich shale plays in Canada and the United States.

The company cut its capital spending plan for the year to about $3.6 billion from the $4 billion it budgeted in February.

The company, which had previously forecast production to be flat to five percent higher in 2012, said it now expected growth to be at the bottom end of that range.

North American natural gas prices fell 40 percent in January-March from a year earlier to average $2.5 per million British thermal unit.

Talisman earned $291 million, or 28 cents per share, compared with a net loss of $326 million, or 32 cents per share, a year ago.

Earnings from operations rose more than 6 percent to $167 million, or 16 cents per share.

Cash flow, a glimpse into the company's ability to fund development, rose 5 percent to $851 million, or 83 cents per share.

Production averaged 462,000 barrels of oil equivalent per day (boe/d), up 4 percent from the year-ago quarter.

Shares of Talisman, which has a market value of $13.51 billion, closed at C$12.92 on Monday on the Toronto Stock Exchange.

(Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Don Sebastian)