Description:

Talisman Energy is an upstream oil and gas business. In 2008, Talisman produced over 430,000 barrels of oil equivalent per day. It is a participant in the UN Global Compact and is also included in the Dow Jones Sustainability (North America) Index. Talisman is the first Canadian company to join the Voluntary Principles on Security and Human Rights (Voluntary Principles) Plenary Group.

Further information:

http://www.talisman-energy.com/

Dilemma: Operated interests in high risk areas of Colombia

Talisman (Colombia) Oil and Gas Ltd. (TCOG) has operated and non-operated interests in 11 blocks in the Greater Llanos region of Colombia. In 2008, the company was awarded operated interests in Blocks CPE 8 and CPO 9 and expects to spend approximately US$63 million in 2009 exploration projects in Colombia.

Operating in Colombia, particularly in remote areas, can present significant security risks due to ongoing internal armed conflict between the government and armed rebel groups. These include: the Revolutionary Armed Forces of Colombia (FARC); the National Liberation Army (ELN); paramilitary forces, and; criminal bands associated with the war against drugs.

Good practice: Incorporation of the Voluntary Principles, due diligence and entry into security 'convenios'

To address security issues and corporate responsibility risks associated with working in Colombia, TCOG has taken a number of precautionary measures - including incorporation of the guidelines established by the Voluntary Principles into its security activities. Other measures include preliminary security and impact assessments in Blocks CPE 8 and CPO 9 prior to initiating any on-the-ground exploration activity, as well as the development of a documented stage gate mitigation process. Under this process, certain security and community consultation metrics must be met for the project to proceed further.

TCOG has been active in ongoing dialogue related to the implementation of the Voluntary Principles and other human rights issues in Colombia. In addition, TCOG has, along with others, strongly advocated the implementation of multilateral security agreements ('convenios') in order to help ensure a responsible approach towards the use of public security personnel.

Results: Security agreements with the state security forces based on international law

Convenios establish the terms under which funds contributed by the operator are used by the trust company to purchase in-kind support for the security operations provided by the Colombian military. They are made between operators, the National Hydrocarbons Agency (ANH), as well as a Colombian trust company (which is responsible for ensuring its terms are adhered to). As part of this arrangement, the ANH has entered into related agreements with the Colombian military for the provision of security to operators within the country.

The terms of the convenios help ensure that money contributed by the operators is used in a responsible way. One of the key purposes of the convenios is to obtain a written agreement by the Colombian Government to the standard of conduct TCOG and its stakeholders expect, and to provide a reporting mechanism for any incidents of violence potentially associated with TCOG's oil activities. Under these agreements:

• Operators contribute only 'in-kind' support such as food and accommodation (and in some cases human rights education and training)
• All such support is for non-lethal and defensive purposes only
• Only the agreed in-kind support can be provided by the trust company to the military (thus precluding cash payments)
• The military are required to comply with all international and humanitarian law treaties to which Colombia has subscribed

Convenios have been entered into by the operators of the Tangara, Niscota and El Caucho Blocks (in which TCOG participates). At the time of writing, the convenios for Blocks 8 and 9 were in the process of completion, but had not yet been finalised.