"We'll focus our capital program on projects that come on stream more quickly and deliver sustainable cash flow over the longer term," Kvisle told a conference call with analysts to discuss Talisman's third-quarter results.
"We'll reduce upfront capital on high-risk exploration in multiple regions around the world. We will continue to explore, but we'll do so in regions we know well and at a lower risk part of the exploration spectrum."
Kvisle, former CEO of pipeline giant TransCanada Corp. (TSX:TRP), cut his retirement short in September to take the top job at the international energy producer.
Also a Talisman board member, Kvisle replaced John Manzoni, who "agreed to" step down after five years as Talisman's CEO.
On the call, Kvisle said it's been a "busy eight weeks" as he's toured the company's southeast Asian and U.S. offices. In the next month, he's planning to visit Talisman operations in Norway, Colombia and the United Kingdom.
He said he sees Talisman's capital budget shrinking by 25 per cent next year to about $3 billion, just 10 to 15 per cent of which will be targeted toward exploration.
"We will live within our means," said Kvisle.
Talisman will look to sustain flat production rates rather than chasing an aggressive growth rate. The company has had trouble meeting production targets in recent years as it has faced a litany of operational problems.
"It's a very tough game to grow because in addition to achieving five or 10 per cent growth, we're also having to offset approximately 25 per cent annual decline in the underlying asset base and it pushes our capital spending program right to the limits in order to do that," said Kvisle.
Rather, the company should allow itself enough "dry powder" so it can easily pounce on opportunistic acquisitions that elevate its production.
"A company that has its balance sheet levered to the maximum that the market would accept really has very little flexibility to take on some extra debt," said Kvisle.
"Successful acquirers in this business in my experience both have debt capacity in their balance sheet and they've delivered sustainable strong results so they trade at a relatively strong price to cash flow multiple."
Kvisle admitted the company's third-quarter financial results were "not impressive."
The company reported a net loss of $731 million, largely as a result of asset writedowns, including its shale operations in Quebec and its offshore operations in Norway.
It says there won't be any capital committed to exploring for gas in Quebec's shale formations for the foreseeable future, due to a provincial government ban on the controversial techniques used to extract the gas from the rock.
Part of the quarter's loss reflects Talisman's writedown of its Quebec assets, to the tune of $109 million before taxes or $82 million after taxes.
The biggest individual impairment, however, was $497 million pre-tax ($125 million after-tax) that completed the writedown of the Yme offshore project in Norway. That's on top of $978 million pre-tax ($248 million after-tax) in the first quarter of 2012.
Talisman's total loss for the third quarter ended Sept. 30 was equal to 71 cents per share and compares with a net income of $521 million, or 51 cents a share, in the same quarter a year ago.
"Our third quarter results provide evidence that Talisman needs a new strategic direction," said Kvisle.
"This will take some time, but we're implementing a new way of business here at Talisman. I know we have some very loyal and some very frustrated shareholders. I'm focused on improving Talisman's financial performance and I appreciate the trust and patience of our long-term shareholders."
Talisman shares fell nearly five per cent to $11.50 on the Toronto Stock Exchange.Suggest a correction