Calgary-based Talisman Energy is reorganizing its North American operations into two businesses, the company announced Tuesday.

One of the new divisions will focus exclusively on shale gas, the other on conventional oil and gas.

Some analysts expect shale gas to supply as much as half the natural gas production in North America by 2020. Some analysts expect shale gas to supply as much as half the natural gas production in North America by 2020. (CBC)

The company also announced it will spend $570 million US on shale gas development in the northeastern United States.

New technology to create and prop open fissures in shale formations has opened up previously inaccessible sources of natural gas and played a role in creating a glut of the fuel.

The announcement overshadowed a dismal earnings report. Talisman's third-quarter profit plummeted by 98 per cent, to $30 million Cdn, mainly on lower prices for oil and gas.

Last year in the same period, the company earned $1.4 billion.

Talisman also announced it will open an office in Pittsburgh to co-ordinate its increased presence in the Marcellus shale gas play in Pennsylvania.

The company has also been active in shale gas exploration in the St. Lawrence Lowlands area of Quebec, between Montreal and Quebec City.

Talisman shares closed unchanged at $18.33 Tuesday on the Toronto Stock Exchange.

Corrections and Clarifications

  • An earlier version of this story erroneously reported that Talisman was splitting into two separate companies. In fact, the company is reorganizing into two divisions. Nov. 3, 2009 / 2:56 ET
(With files from The Canadian Press)