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By Maryelle Demongeot
KUALA LUMPUR, June 11 (Reuters) - Talisman Energy Inc. TLM.TO will add around 25,000 barrels per day (bpd) to Vietnam’s declining oil output when its first oilfield starts production in May next year, its top official said on Monday.
“In a setting where the industry is particularly tight, the Song Doc development is progressing very well,” said Jim Buckee, Chief Executive Officer of Talisman told Reuters in an interview at the Asia Oil and Gas Conference (AOGC).
The Song Doc oilfield, in block 46/02, in the Malay basin has gross reserves of around 25 million barrels.
Talisman, which was established when BP (BP.L) spun off its Canadian assets, holds a 30 percent interest in the Song Doc field, with Petrovietnam holding 40 percent and Malaysia’s Petronas [PETR.UL] owning 30 percent.
The Song Doc field may be the first of several producing fields in Vietnam for Talisman as it has made a series of discoveries on block 15-2/01, which are even more promising.
The Hai Su Trang discovery flowed at 15,000 bpd and holds reserves of up to 50 million barrels. The entire block could hold much more, as it is an extension of the Te Giac Trang structure, on block 15-1, which holds more than double those reserves and could produce up to 70,000 bpd.
Petrovietnam, UK Soco and Thailand PTTEP hold block 15-1.
“I fully expect the block to be commercial. We anticipate production in 2010,” said Buckee, who will retire in September.
Talisman, the No. 3 Canadian independent company, is also present in Malaysia, Indonesia and Australia.
“We are trying to grow here. North America and the North Sea are very mature and competitive regions. Asia is less explored,” Buckee said.
Talisman, which has gas developments in Malaysia and Indonesia, is also turning to deepwater exploration, the buzzword at this year’s AOGC in Malaysia, where three major fields are slated for development in the next five years.
U.S. independent Murphy Oil Corp. (MUR.N) will bring Malaysia’s first deepwater development on stream by August or September this year, with production to peak at 125,000 bpd. Shell’s (RDSa.L) Gumusut field could produce up to 150,000 bpd by 2012.
Buckee said Talisman had failed so far in its efforts to acquire interests in deepwater blocks in Malaysia, although it has secured acreage in Indonesia.
Talisman is also looking at taking over declining oilfields in Asia.
“We have demonstrated in the North Sea that we are very able to slow the decline and increase production in fields that used to be in the hands of the majors,” Buckee said.
Talisman bought last year the Auk and Fulmar fields from Shell and Exxon Mobil Corp (XOM.N). Many oil majors are selling older, declining fields to independent companies in the North Sea as the fields are too small for their global portfolio.
Talisman also has a stake in Norway’s Yme field, which was shut down in 2001 when oil prices were low. With higher prices, the field is being revived and is expected to resume production in 2009 at a maximum rate of 40,000 bpd.
Experts estimate oilfields worldwide decline at an average 7-8 percent rate per year and small, independent companies, have made their business to enhance recovery on these fields.
“Governments should make sure that the assets get in the right hands. It is time for companies like Exxon to move over and time for independents to exploit these fields,” he added.
Buckee said that Talisman has told government regulators that the company would like to inherit declining fields.
Talisman expects an average output of 485,000 bpd this year.