Obligation Repsolis 6.25% ( US87425EAK91 ) en USD

Société émettrice Repsolis
Prix sur le marché refresh price now   108 %  ⇌ 
Pays  Canada
Code ISIN  US87425EAK91 ( en USD )
Coupon 6.25% par an ( paiement semestriel )
Echéance 31/01/2038



Prospectus brochure de l'obligation Repsol US87425EAK91 en USD 6.25%, échéance 31/01/2038


Montant Minimal /
Montant de l'émission /
Cusip 87425EAK9
Prochain Coupon 01/08/2025 ( Dans 26 jours )
Description détaillée Repsol est une compagnie énergétique multinationale espagnole intégrée verticalement, active dans l'exploration et la production, le raffinage et la commercialisation de pétrole et de gaz naturel, ainsi que dans les énergies renouvelables.

L'Obligation émise par Repsolis ( Canada ) , en USD, avec le code ISIN US87425EAK91, paye un coupon de 6.25% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 31/01/2038







Prospectus Supplement
November 7, 2006
(to Prospectus dated December 19, 2005)
US$600,000,000
29APR200512084254
6.250% Notes due 2038
The notes will bear interest at the rate of 6.250% per year. We will pay interest on the notes semi-annually in
arrears on February 1 and August 1 of each year, beginning February 1, 2007. The notes will mature on February 1,
2038. We may redeem some or all of the notes at any time, at 100% of their principal amount plus a make-whole
premium as described in this prospectus supplement. We may also redeem all (and not less than all) of the notes if
certain changes affecting Canadian withholding taxes occur. The notes do not have the benefit of any sinking fund.
The notes will be our unsecured obligations and rank equally with all of our existing and future unsecured and
unsubordinated indebtedness.
Investing in the notes involves risks that are described in the ``Risk Factors'' section beginning on page 23 of the
accompanying prospectus.
We are permitted, under a multi-jurisdictional disclosure system adopted by the United States and Canada, to
prepare this prospectus supplement and the accompanying prospectus in accordance with Canadian disclosure
requirements which are different from those of the United States. We prepare our financial statements in accordance
with Canadian generally accepted accounting principles and are subject to Canadian auditing and auditor independence
standards. As a result, they may not be comparable to financial statements of United States companies in certain
respects. Information regarding the impact upon our financial statements of significant differences between Canadian
and U.S. generally accepted accounting principles is contained in the notes to the annual consolidated financial
statements incorporated by reference in the accompanying prospectus.
Owning the notes may subject you to tax consequences both in the United States and in Canada. This prospectus
supplement and the accompanying prospectus may not describe these tax consequences fully. You should read the tax
discussion in this prospectus supplement.
Your ability to enforce civil liabilities under the U.S. federal securities laws may be affected adversely because we
are incorporated in Canada, some or all of our officers and directors and some or all of the experts named in this
prospectus supplement and the accompanying prospectus are residents of Canada, and a substantial portion of our
assets and all or a substantial portion of the assets of such persons are located outside of the United States.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved
of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete.
Any representation to the contrary is a criminal offence.
Per Note
Total
Public offering price(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
98.341%
US$590,046,000
Underwriting commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.875%
US$ 5,250,000
Proceeds, before expenses, to Talisman(1) . . . . . . . . . . . . . . . . . . . . . .
97.466%
US$584,796,000
(1) Plus accrued interest from November 10, 2006 if settlement occurs after that date.
The underwriters expect to deliver the notes in book-entry form only through the facilities of The Depository Trust
Company against payment in New York, New York on or about November 10, 2006.
Joint Book-Running Managers
Banc of America Securities LLC
Citigroup
Lead Managers
BNP PARIBAS
HSBC
Co-Managers
CIBC World Markets
RBC Capital Markets
Scotia Capital
LaSalle Capital Markets
RBS Greenwich Capital
TD Securities


IMPORTANT NOTICE ABOUT INFORMATION IN
THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS
This document is in two parts. The first part, this prospectus supplement, describes the specific
terms of the notes we are offering and also adds and updates certain information contained in the
accompanying prospectus and documents incorporated by reference. The second part, the base
prospectus, dated December 19, 2005, gives more general information, some of which may not apply to
the notes we are offering. The accompanying base prospectus is referred to as the ``prospectus'' in this
prospectus supplement.
If the description of the notes varies between this prospectus supplement and the prospectus, you
should rely on the information in this prospectus supplement.
You should rely only on the information contained in or incorporated by reference in this
prospectus supplement and the prospectus. We have not, and the underwriters have not, authorized
any other person to provide you with different information. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not, and the underwriters are not, making
an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should
assume that the information appearing in this prospectus supplement and the prospectus, as well as
information we previously filed with the U.S. Securities and Exchange Commission and with the
Alberta Securities Commission and incorporated by reference, is accurate as of the date of such
information only. Our business, financial condition, results of operations and prospects may have
changed since those dates.
In this prospectus supplement, all capitalized terms used and not otherwise defined herein have
the meanings provided in the prospectus. In the prospectus and this prospectus supplement, unless
otherwise specified or the context otherwise requires, all dollar amounts are expressed in Canadian
dollars, and all financial information included and incorporated by reference in the prospectus and this
prospectus supplement is determined using Canadian generally accepted accounting principles
(``Canadian GAAP''). ``U.S. GAAP'' means generally accepted accounting principles in the
United States. For a discussion of the principal differences between our financial results as calculated
under Canadian GAAP and under U.S. GAAP, you should refer to note 21 of our audited consolidated
financial statements for the year ended December 31, 2005, incorporated by reference in
the prospectus.
Unless otherwise specified or the context otherwise requires, all references in this prospectus
supplement and the prospectus to ``we'', ``us'', ``our'' or ``Talisman'' refer to Talisman Energy Inc. and
its subsidiaries on a consolidated basis. In the sections entitled ``Summary of the Offering'' and
``Description of the Notes'' in this prospectus supplement and ``Description of Debt Securities'' in the
prospectus, ``we'', ``us'', ``our'' or ``Talisman'' refer to only Talisman Energy Inc., without any of its
subsidiaries.
This prospectus supplement is deemed to be incorporated by reference into the prospectus solely
for the purposes of the offering of the notes offered hereby. Other documents are also incorporated or
deemed to be incorporated by reference into the prospectus. See ``Documents Incorporated by
Reference'' in this prospectus supplement and ``Where You Can Find More Information'' in
the prospectus.
S-2


TABLE OF CONTENTS
Prospectus Supplement
Page
Forward-Looking Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-4
Exchange Rate Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-5
Summary of the Offering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-6
Talisman Energy Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-8
Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-8
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-9
Selected Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-9
Consolidated Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-10
Pro-Forma Interest Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-11
Description of the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-12
Credit Ratings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-16
Certain Income Tax Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-17
Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-19
Legal Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-22
Documents Incorporated by Reference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-23
Prospectus
About This Prospectus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Where You Can Find More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Special Note Regarding Forward-Looking Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Talisman Energy Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Description of Debt Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Certain Income Tax Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Interest Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Legal Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
S-3


FORWARD-LOOKING INFORMATION
This document contains or incorporates statements that constitute ``forward-looking statements''
within the meaning of the United States Private Securities Litigation Reform Act of 1995. Any
statements that express or involve discussions with respect to predictions, business strategy, budgets,
exploration and development opportunities or projects, acquisitions and dispositions, expectations,
beliefs, plans, objectives, assumptions or future events or performance (often, but not always, using
words or phrases such as ``expects'' or ``does not expect'', ``is expected'', ``anticipates'' or ``does not
anticipate'', ``plans'', ``projects'', ``believes'', ``forecasts'', ``estimates'', ``intends'', ``possible'', ``probable'',
``scheduled'', ``likely'' or ``positioned'', or stating that certain actions, events or results ``may'', ``could'',
``should'', ``would'', ``might'' or ``will'' be taken, occur or be achieved) are not statements of historical
fact and may be ``forward-looking statements''. In addition, our statements relating to our targeted
production per share growth of approximately 5% to 10% annually from 2006 through 2009 are
``forward-looking statements''. Such statements are included, among other places, in this document
under the headings ``Talisman Energy Inc.'' and ``Recent Developments'', in the prospectus under the
heading ``Risk Factors'', in our Annual Information Form under the headings ``General Development of
the Business'', ``Description of the Business'', ``Legal Proceedings'' and ``Risk Factors'', in the
Management's Discussion and Analysis for the year ended December 31, 2005, and in the
Management's Discussion and Analysis for the nine months ended September 30, 2006. Statements
concerning oil and gas reserves contained in the Annual Information Form under ``Description of the
Business--Reserves Estimates'' and ``Description of the Business--Other Oil and Gas Information'' or
in the annual consolidated financial statements for the year ended December 31, 2005 and elsewhere
also may be deemed to be forward-looking statements as they involve the implied assessment, based on
certain estimates and assumptions, that the resources described can be profitably produced in
the future.
You are cautioned not to place undue reliance on forward-looking statements. Forward-looking
statements are based on current expectations, estimates and projections at the time the statements are
made that involve a number of risks and uncertainties which could cause actual results to differ
materially from those anticipated by us. These risks and uncertainties include, but are not limited to:
· the risks of the oil and gas industry such as operational risks in exploring for, developing and
producing crude oil and natural gas and market demand;
· risks and uncertainties involving geology of oil and gas deposits;
· the uncertainty of reserves estimates and reserves life;
· the uncertainty of estimates and projections relating to production, costs and expenses;
· potential delays or changes in plans with respect to exploration or development projects or
capital expenditures;
· fluctuations in oil and gas prices, foreign currency exchange rates and interest rates;
· the outcome and effects of completed acquisitions, as well as any potential future acquisitions
and dispositions;
· our ability to integrate assets we have acquired or may acquire or the performance of
those assets;
· health, safety and environmental risks;
· uncertainties as to the availability and cost of financing and changes in capital markets;
· uncertainties related to the litigation process, such as possible discovery of new evidence or
acceptance of novel legal theories and the difficulties in predicting the decisions of judges
and juries;
S-4


· risks in conducting foreign operations (for example, political and fiscal instability or the
possibility of civil unrest or military action);
· changes to general economic and business conditions;
· the effect of acts of, or actions against, international terrorism;
· the possibility that government policies or laws may change or governmental approvals may be
delayed or withheld;
· results of our risk mitigation strategies, including insurance and hedging programs;
· our ability to implement our business strategy; and
· market competition.
We caution that the foregoing list of risks and uncertainties is not exhaustive. Events or
circumstances could cause our actual results to differ materially from those estimated or projected and
expressed in, or implied by, these forward-looking statements. Additional information concerning
certain of these and other factors which could affect our operations or financial results are included
under the heading ``Risk Factors'' in the prospectus, including information incorporated by reference
thereunder, in our Management's Discussion and Analysis incorporated by reference in the prospectus,
under the heading ``Risk Factors'' in our Annual Information Form as well as in our other reports on
file with Canadian securities regulatory authorities and the United States Securities and Exchange
Commission.
Forward-looking statements are based on our estimates and opinions of our management at the
time the statements are made. Other than as required by law, we undertake no obligation to update
forward-looking statements should circumstances or estimates or opinions change.
EXCHANGE RATE INFORMATION
We publish our consolidated financial statements in Canadian dollars. In this prospectus
supplement, unless otherwise specified or the context otherwise requires, all dollar amounts are
expressed in Canadian dollars and references to ``dollars'' or ``$'' are to Canadian dollars and
references to ``US$'' are to United States dollars.
The following table sets forth the Canada/U.S. exchange rates on the last day of the periods
indicated as well as the high, low and average rates for such periods. The high, low and average
exchange rates for each period were identified or calculated from spot rates in effect on each trading
day during the relevant period. The exchange rates shown are expressed as the number of U.S. dollars
required to purchase one Canadian dollar. These exchange rates are based on those published on the
Bank of Canada's website as being in effect at approximately noon on each trading day (the ``Bank of
Canada noon rate''). On November 7, 2006, the Bank of Canada noon rate was US$0.8868
equals $1.00.
Nine Months
Ended
Year Ended December 31,
September 30,
2005
2004
2003
2006
2005
Period End . . . . . . . . . . . . . . .
0.8577
0.8308
0.7738
0.8966
0.8613
High . . . . . . . . . . . . . . . . . . .
0.8690
0.8493
0.7738
0.9099
0.8613
Low . . . . . . . . . . . . . . . . . . . .
0.7872
0.7159
0.6350
0.8528
0.7872
Average . . . . . . . . . . . . . . . . .
0.8254
0.7683
0.7135
0.8830
0.8171
S-5


SUMMARY OF THE OFFERING
The following is a brief summary of some of the terms of this offering. For a more complete description
of the terms of the notes, see ``Description of the Notes'' in this prospectus supplement and ``Description of
Debt Securities'' in the prospectus.
Issuer . . . . . . . . . . . . . .
Talisman Energy Inc.
Securities Offered . . . . . .
US$600 million aggregate principal amount of 6.250% notes.
Interest Payment Dates . .
February 1 and August 1 of each year, beginning, February 1, 2007.
Maturity Date . . . . . . . .
February 1, 2038.
Ranking . . . . . . . . . . . . .
The notes will be our direct, unsecured and unsubordinated obligations
and will rank equally with all of our existing and future unsecured and
unsubordinated indebtedness. We conduct a substantial portion of our
business through corporate and partnership subsidiaries. The notes will
be structurally subordinate to all existing and future indebtedness and
liabilities of any of our corporate and partnership subsidiaries. See
``Description of the Notes--Ranking and Other Indebtedness'' in this
prospectus supplement and ``Description of Debt Securities--Ranking
and Other Indebtedness'' in the prospectus. As at September 30, 2006,
our subsidiaries had approximately $1,801 million of indebtedness and
other liabilities to third parties, including accounts payable and income
and other taxes payable.
Optional Redemption . . .
We may redeem the notes, in whole or in part, at any time, at the
``make-whole'' price described in this prospectus supplement. See
``Description of the Notes--Optional Redemption'' in this prospectus
supplement.
We may also redeem the notes in whole, but not in part, at the
redemption prices described in the accompanying prospectus at any time
in the event certain changes affecting Canadian withholding taxes occur.
See ``Description of Debt Securities--Tax Redemption'' in the prospectus.
Sinking Fund . . . . . . . . .
None.
Certain Covenants . . . . .
The indenture pursuant to which the notes will be issued contains certain
covenants that, among other things, limit:
·
our ability and the ability of our Restricted Subsidiaries (as defined
in the indenture) to create liens; and
·
our ability (but not the ability of our corporate and partnership
subsidiaries) to merge, amalgamate or consolidate with, or sell all or
substantially all of our assets to, any other person other than our
Restricted Subsidiaries.
These covenants are subject to important exceptions and qualifications
that are described under the caption ``Description of Debt Securities--
Certain Covenants'' in the prospectus.
S-6


Use of Proceeds . . . . . . .
The net proceeds to us from this offering will be US$584.1 million, after
deducting the underwriting commission, and estimated expenses payable
by us of approximately US$0.7 million. The net proceeds received by us
from the sale of the notes will be used for general corporate purposes,
including the repayment of existing indebtedness. We may invest funds
that we do not immediately use in short-term marketable securities. See
``Use of Proceeds'' in this prospectus supplement.
Credit Ratings . . . . . . . .
The notes have been assigned a rating of ``Baa2(stable)'' by Moody's
Investors Service, Inc., a rating of ``BBB+'' by Standard & Poor's
Corporation and a rating of ``BBB(high)(stable)'' by Dominion Bond
Rating Service Limited. The credit ratings assigned to the notes by the
rating agencies are not recommendations to buy, sell or hold the notes
and may be revised or withdrawn entirely at any time by the rating
agency issuing such rating. There can be no assurance that a rating will
remain in effect for a given period of time or that a rating will not be
revised or withdrawn entirely by the rating agency issuing such rating in
the future.
Additional Amounts . . . .
Any payments made by us with respect to the notes will be made without
withholding or deduction for Canadian taxes unless required to be
withheld or deducted by law or by the interpretation or administration
thereof. If we are so required to withhold or deduct for Canadian taxes
with respect to a payment to the holders of notes, we will pay the
additional amount necessary so that the net amount received by the
holders of notes after such withholding or deduction is not less than the
amount that such holders would have received in the absence of the
withholding or deduction. However, no additional amount will be payable
in excess of the additional amount that would be payable if the holder
was a resident of the United States for purposes of the
Canada-U.S. Income Tax Convention (1980), as amended. See
``Description of Debt Securities--Certain Covenants--Additional
Amounts'' in the prospectus.
Form and Denomination .
The notes will be represented by one or more fully registered global
notes deposited in book entry form with, or on behalf of, The Depository
Trust Company, and registered in the name of its nominee, Cede & Co.
Beneficial interests in any registered Global Note will be in
denominations of US$1,000 and integral multiples of US$1,000. See
``Description of the Notes--Book Entry System'' in this prospectus
supplement. Except as described under ``Description of the Notes'' in this
prospectus supplement and ``Description of Debt Securities'' in the
prospectus, notes in certificated form will not be issued.
Governing Law . . . . . . . .
The notes and the indenture governing the notes will be governed by the
laws of the State of New York.
S-7


TALISMAN ENERGY INC.
We are an independent, Canadian based, international upstream oil and gas company whose main
business activities include exploration, development, production, transportation and marketing of crude
oil, natural gas and natural gas liquids. Our geographic operating segments are North America,
United Kingdom, Scandinavia, Southeast Asia and Australia and Other (which includes Algeria, Tunisia
and Trinidad and Tobago), where we have ongoing production, development and exploration activities.
We are also active in a number of other international and frontier areas, including Colombia, Peru
and Qatar.
Our head office is located in Calgary, Alberta, Canada. We were established as an independent
company in 1992 and are incorporated under the laws of Canada. Our common shares trade on the
Toronto Stock Exchange and the New York Stock Exchange under the trading symbol ``TLM.''
Our mission is value creation in the upstream oil and gas business. Our focus is on production per
share growth while managing costs within a disciplined capital structure. We have averaged 11% annual
production per share growth between 1992 and 2005 and have a target of 5% to 10% average
compound annual production per share growth between 2006 and 2009.
North America and the North Sea accounted for approximately three quarters of our net
production in the first nine months of 2006. We target larger opportunities, including deep gas in North
America and large international projects. We direct 5% to 10% of our overall spending to higher
impact exploration opportunities in both our existing core production areas and in new international
and frontier areas such as those listed above.
We continually investigate strategic acquisitions and opportunities, some of which may be material.
In connection with any such transaction, we may incur debt or issue equity.
RECENT DEVELOPMENTS
Earlier in 2006, we announced that we were undertaking a broad review of our non-core assets
worldwide. As at the date of this prospectus supplement, we have:
· completed the sale of our UK subsidiary, Talisman Expro Limited, to Endeavour Energy UK
Limited for a sale price of US$414 million;
· completed the disposition of non-strategic assets in Canada through various transactions, for
aggregate proceeds of approximately $379 million;
· commenced a competitive auction process whereby we are seeking to identify the best
alternatives for realizing the value of our oil sands assets; and
· commenced a process to sell further select non-core properties in North America and the UK
sector of the North Sea.
The proceeds from the sale of Talisman Expro Limited were used for repayment of existing debt
and for general corporate purposes and the proceeds from the disposition of the Canadian non-core
assets were used to partially repay amounts outstanding under the acquisition bridge facility used to
acquire Paladin Resources plc in 2005. The majority of the cash proceeds from the oil sands
dispositions and the disposition of further select non-core properties in North America and the UK
sector of the North Sea will be used to repurchase Talisman shares, subject to all necessary approvals.
In October, 2006, one of our subsidiaries entered into agreements to acquire various interests in the
Fulmar and Auk fields, both located in the UK sector of the Central North Sea.
S-8


USE OF PROCEEDS
The net proceeds to us from this offering will be US$584.1 million, after deducting the
underwriting commission and after deducting estimated expenses of the offering of approximately
US$0.7 million. The net proceeds received by us from the sale of the notes will be used for general
corporate purposes, including the repayment of existing indebtedness. We may invest funds that we do
not immediately use in short-term marketable securities.
SELECTED FINANCIAL INFORMATION
The following table sets forth selected financial information for the years ended December 31,
2005, 2004 and 2003 derived from our audited consolidated financial statements which have been
audited by Ernst & Young LLP and for the nine months ended September 30, 2006 and 2005 derived
from our unaudited interim consolidated financial statements and adjusted to reflect discontinued
operations. Our consolidated financial statements are prepared in accordance with Canadian GAAP,
which differs in certain respects from U.S. GAAP. For a discussion of the principal differences between
our financial results as calculated under Canadian GAAP and under U.S. GAAP, you should refer to
Note 21 of our consolidated financial statements for the year ended December 31, 2005, incorporated
by reference into the prospectus. You should read this selected consolidated financial information in
conjunction with our audited annual consolidated financial statements and the related notes, our
unaudited interim consolidated financial statements, and other information included in the documents
incorporated by reference in the prospectus. Our historical results are not necessarily indicative of the
results that may be expected for any future period or for a full year.
Nine Months
Ended
Years Ended December 31,
September 30,
2005
2004
2003
2006
2005
(millions of dollars)
Income statement items:(1)
Net sales, continuing operations (net of
hedging and royalties) . . . . . . . . . . . . . . . .
7,599
5,031
4,325
6,186
5,309
Net income from continuing operations . . . . .
1,477
584
921
1,187
971
Net income from discontinued operations(2) . .
84
70
55
220
57
Net income(3) . . . . . . . . . . . . . . . . . . . . . . . .
1,561
654
976
1,407
1,028
Cash flow statement items:(1)
Cash provided by continuing operations . . . . .
4,694
2,957
2,409
3,204
3,050
Cash provided by discontinued operations . . .
177
162
145
182
122
Cash provided by operating activities(3) . . . . . .
4,871
3,119
2,554
3,386
3,172
Cash (used in) investing activities . . . . . . . . .
(6,144)
(2,757)
(1,710)
(2,936)
(2,742)
Cash provided by (used in) financing
activities(3) . . . . . . . . . . . . . . . . . . . . . . . . .
1,346
(401)
(745)
(456)
(87)
S-9


Nine Months
Ended
Years Ended December 31,
September 30,
2005
2004
2003
2006
2005
(millions of dollars)
Balance sheet items (at period end):
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . .
18,339
12,408
11,780
19,542
14,126
Total liabilities(3) . . . . . . . . . . . . . . . . . . . . . .
12,610
7,577
7,156
12,524
8,752
Shareholders' equity(3) . . . . . . . . . . . . . . . . . .
5,729
4,831
4,624
7,018
5,374
(1) During the second quarter of 2006, we entered into agreements to dispose of certain non-core oil and gas producing assets
and in the third quarter announced our intention to sell certain other non-core oil and gas producing assets. Further
information on these discontinued operations is included in our Supplemental Financial Information dated November 7,
2006 incorporated by reference into the prospectus. See ``Documents Incorporated by Reference''.
(2) Amounts incorporate gains on asset dispositions closed in the relevant period.
(3) Effective January 1, 2005, we retroactively adopted certain changes to the Canadian Institute of Chartered Accountants
accounting standard for financial instruments. The change to this standard requires that our preferred securities, all of which
were redeemed in 2004, be treated as debt rather than equity. Previously, preferred securities charges were charged directly
to retained earnings but under the new accounting standard they would have been charged to interest expense. In addition,
since the preferred securities would have been treated as debt, the balance would have been revalued at each balance sheet
date with the offsetting movement reflected in the cumulative foreign currency translation account. As a result, there would
not have been a gain on the redemption of the preferred securities. The results for 2004 and 2003 have been restated to give
effect to this retroactive adoption. There was no impact to the 2005 results as the preferred securities were fully redeemed in
2004. Further details are set forth in note 2 to our comparative audited consolidated financial statements for the year ended
December 31, 2005, incorporated by reference in the prospectus.
CONSOLIDATED CAPITALIZATION
The following table summarizes our consolidated capitalization at September 30, 2006, and as
adjusted to give effect to the issuance of the notes offered by this prospectus supplement and the
application of the net proceeds to repay existing indebtedness. You should read this table together with
the unaudited interim consolidated financial statements for the nine months ended September 30, 2006
incorporated by reference in the prospectus. In the ``As Adjusted'' column, the U.S. dollar amount of
the notes offered hereby has been converted to Canadian dollars using the Bank of Canada noon
buying rate of US$0.8966 per $1.00 at September 30, 2006.
As at
September 30, 2006
Actual
As Adjusted
(millions of dollars)
Long-term liabilities:
Long-term debt (including current portion) . . . . . . . . . . . . . . . . . . . . . . . . .
4,001
3,349
Notes offered hereby . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
--
669
Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,001
4,018
Shareholders' equity:
Common shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,595
2,595
Contributed surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
69
69
Cumulative foreign currency translation . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(148)
(148)
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,502
4,502
Total shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,018
7,018
Total capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,019
11,036
S-10


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