Talisman Energy Inc.: The decision to enter Iraq

Talisman Energy Inc.: The decision to enter Iraq

Problem Statement Independent Canadian oil and gas producerJohn Manzoni weighs the pros and cons of entering IraqSudan experience

StakeholdersTalisman Renamed after British Petroleum Small Independent Canadian oil and gas producer Limited resourcesDomestic competition forced Talisman to look outside Canadian market

John ManzoniChief Executive Officer of TalismanHighly experienced individualAssigned to find an alternative locationWants to avoid earlier problems that arose in Sudan

The Board MembersPresent during Sudan CrisisHigh risk, high rewardDetermine whether or not Talisman will operate in Iraq

Kurdistan Regional Government Tumultuous history in IraqDistinct culture separates them from other IraqisRecognized by U.S. governmentSought autonomy and established the KRGOpposed by neighboring countries

Marathon OilU.S. based companyDiscouraged from Investing in IraqSold assets to WesternZagros

WesternZagrosCanadian FirmRaised $180 million to fund its exploration in KurdistanTalisman discussed with KRG to enter into a joint venture with WesternZagros IssuesUncertainty of the $220MM feesSudan experienceOil permits and licenses issued by KRGOil pipeline through southern Iraq

Issues

Issues cont Security concernsPolitical resistanceLimited funds and technologyAlternativesEnter Into KurdistanEnter the Kurdistan region aloneCommence a joint operations agreement with Western ZagrosDont enter into KurdistanContinue financing the oil extractions in the bituminous sands of Alberta Invest money in researching other viable options.Recommendation Enter the Kurdistan Region upon finishing all precautionary steps

We cant really choose where we work. I think for a company of our size, which is not in the oil sands and is looking to the international arena to continue its growth, from an exploration perspective, we are having to move into more and more challenging environments.

- Meg Mahnas: Talismans ex vice president of corporate affairs

Steps:Consult with Canadian & US governments before, during and after entering KurdistanConsult any and all affiliated NGOs to establish transparency and gain perspective on above ground risksEstablish relations with local broadcast mediaMaintain public and transparent records of fees paid to KRG and how they were allocated (?)