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by Stockwatch Business Reporter

West Texas Intermediate crude for October delivery added two cents to $93.88 on the New York Merc, while Brent for October added 22 cents to $102.72 (all figures in this para U.S.). Western Canadian Select traded at a discount of $16.65 to WTI ($77.23), up from a discount of $16.75. Natural gas for September added 4.6 cents to $3.95. The TSX energy index lost a fraction to close at 322.28.

Talisman Energy Inc. (TLM) lost 59 cents to $11.10 on 11 million shares. Negotiations for an asset acquisition or takeover by Spain's Repsol have hit a snag and are "frozen," sources told The Wall Street Journal. Another source in Madrid told French newspaper Le Figaro that Repsol is no longer seeking to buy Talisman outright. The sticking point seems to be the company's assets in the North Sea off the coast of Norway and Britain. Repsol is not opposed to being in this part of world -- it holds rights to 18 licences and farmed in for part of another last week -- but Talisman's assets have been underperforming for about two years, and are also difficult for the company to unload because they carry contractual obligations to joint venturer Sinopec. Repsol is likely more interested in Talisman's prize assets in Canada (notably in the Montney and Duvernay plays) and the United States (notably in the Marcellus and the Eagle Ford). Not only are these North American operations productive, flowing 177,000 barrels of oil equivalent a day in the second quarter, they are in safe operating areas, a priority for Repsol given its rocky experiences elsewhere in the world. Its operations in Sierra Leone, Morocco and Libya have all faced disruptive security problems, and in 2012, its subsidiary in Argentina was seized without compensation by the government, leading to a bitter legal battle that ultimately led to a $5-billion settlement this spring. Repsol says it will now spend up to $10-billion on acquisitions primarily in safer parts of the world. Talisman's North American plays fit the bill, but it also owns assets in Colombia and Iraqi Kurdistan. Repsol might be amenable to Colombia -- in March, it was thinking about buying Pacific Rubiales Energy Corp. (PRE: $22.12), according to Bloomberg -- but Kurdistan is a stretch.

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