M. Jacqueline Sheppard

Executive Vice-President, Corporate and Legal - Talisman Energy

Ms. Sheppard joined Talisman in 1993 and is responsible for the Company's worldwide legal affairs, corporate projects and acquisitions and is secretary to the board. Corporate communications, investor relations and corporate responsibility are also her responsibilities.

In the past five years, we have taken our expertise further and opened up new opportunities. In North America, we acquired a foothold in Appalachia and rapidly became the largest natural gas producer in New York state. In Canada, we are building a new core area in the Outer Foothills region of Alberta.

In the North Sea, Talisman continued to acquire assets where there was potential for development upside. We expanded into Norway, acquiring the Varg and Gyda fields, and became the third largest acreage holder in the country. The Company also made a significant discovery at Tweedsmuir, which was tied back to the Piper B platform, and has recently made an exploration discovery at Cayley. Southeast Asia has become our fastest growing core area, with first production from PM-3 CAA and growing volumes at Corridor. In addition, the Company acquired a very prospective exploration block off the coast of Vietnam. Talisman recently announced three successful exploration and appraisal wells in Vietnam and has an active drilling program planned for 2008. In addition, we were awarded two deepwater blocks offshore in Indonesia with drilling set to begin in 2009.

2007 was largely defined by ongoing asset sales, which had a significant impact on Talisman’s headline production, cash flow and earnings numbers. Over the past two years, we have sold 57,000 boe/d of non-core assets (producing approximately 28,000 boe/d in 2007), using the proceeds to repurchase approximately $1.6 billion in shares.

Production averaged 452,000 boe/d in 2007, down 7% from a year earlier. Production volumes were down primarily due to asset sales, while production from continuing operations was down slightly, reflecting a number of project delays.

Cash flow for the year was $4.3 billion, down 9% from 2006 and cash flow per share was down 4%, reflecting the repurchase of 46 million shares in 2007. Excluding cash generated by discontinued operations, cash flow was unchanged at $4.2 billion.