Talisman Energy

Talisman’s investment in Sudan resulted in a negative experience for the company and its reputation. The company learned that they had to implement many policies and procedures regarding how to assess risky situations like Sudan. Despite the fact that the firm made a lot of money in Sudan, the negative publicity and resulting losses were far too great. As a result, Talisman adopted and implemented a formal code of ethics after its experience in Sudan. The company learned that they had to commit greater due diligence and analyze a country’s political environment before conducting business in that region. By adding the International Code of Ethics into its corporate code, Talisman was able to move past the negative Sudan experience and make sure they were not seen as supporting human rights violations again. As well, Talisman provided training to its employees in human rights so they could be proactive in their business dealings in other countries. Talisman also established a corporate responsibility group to develop procedures, policies and reporting protocols for future business. This group was involved in assessing the risk involved in new endeavors. Talisman also learned that beyond policies and procedures, they needed to become part of the UN Global Compact to show their support of the 10 principles (human rights, labor, environment, anti-corruption etc.). This shows their investors and the public that they learned from their mistakes in Sudan and are fully committed to supporting ethical business practices moving forward.

Talisman could be very profitable if they are able to be operative quickly. Assuming a peak production rate of 80-260k barrels per day and a price of $130/barrel, Talisman could realize revenues between $10,400,000 and $33,800,000 per day. The annual revenues assuming 200 drilling days/year would be between $2.08B and $6.76B a year at its production peak (4-5 years from now). Considering the facts given in the case in regards to...