UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 40-F

|(CHECK ONE) |  |                                                                                         
|----------- |  | ----------------------------------------------------------------------------------------
|o           |  | Registration statement pursuant to Section 12 of the Securities and Exchange Act of 1934
|OR          |  |                                                                                         
|ý           |  | Annual Report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 

For
the fiscal year ended: December 31, 2006
Commission File Number: 001-06665

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TALISMAN ENERGY INC.(Exact name of Registrant as specified in its charter)

|Canada(Province or other jurisdiction of
incorporation or organization)                                                                                 |  | 1311(Primary standard industrial classification code number, if applicable) |  | Not applicable(I.R.S. employer identification number, if applicable)
|------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------- |  | --------------------------------------------------------------------
|Suite 3400, 888  3rd Street SW
Calgary, Alberta
Canada T2P 5C5
(403) 237-1234(Address and telephone number of registrant's principal executive office)

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NATIONAL CORPORATE RESEARCH, LTD.

1780 Barnes Blvd. Southwest
Tumwater, Washington 98512-0410
(800) 722-0708(Name, address (including zip code) and telephone number
(including area code) of agent for service in the United States)

|Securities registered pursuant to Section 12(b) of the Act:
|-----------------------------------------------------------
|Title of each class:Common Shares of no par value          

Securities
registered pursuant to Section 12(g) of the Act:None

Securities
for which there is a reporting obligation pursuant to Section 15(d) of the Act:7.125% Debentures, due 2007
        7.25% Debentures, due 2027
        5.125% Notes, due 2015
        5.750% Notes, due 2035
        5.850% Notes, due 2037
        6.250% Notes, due 2038

For
annual reports, indicate by check mark the information filed with this Form:

ý  Annual
Information Form                   ý  Audited Annual Financial Statements

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Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report.Common Shares: 1,063,928,405

Indicate
by check mark whether the Registrant by filing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to
Rule 12g3-2(b) under the Securities Exchange Act of 1934 (the "Exchange Act"). If "Yes" is marked, indicate the file number assigned to the Registrant in connection with
such Rule.

Yes  o                   No  ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the
preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past
90 days.

Yes  ý                   No  o



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The following documents, or the portions thereof indicated below, that are filed as exhibits to this Annual Report on Form 40-F, are incorporated herein by
this reference.



FORWARD-LOOKING STATEMENTS

This Form 40-F contains or incorporates by reference statements that constitute forward-looking statements or forward-looking information
(collectively, "forward-looking statements") within the meaning of applicable securities legislation.

Forward-looking
statements are included throughout the Annual Report on Form 40-F and the documents incorporated by reference herein including, among other
places: (1) in the Annual Information Form of the Registrant dated March 13, 2007 under the headings "General Development of the Business", "Description of the Business", "Legal
Proceedings" and "Risk Factors"; and (2) in the Management's Discussion and Analysis of the Registrant dated March 13, 2007 under the headings "2007 Outlook
Summary", "Outlook for 2007", "2007 Geographic Outlook", "Approximate Impact for 2007" and "Risk Factors". These statements include, among others, statements regarding:



Statements
concerning oil and gas reserves contained in the Annual Information Form of the Registrant dated March 13, 2007 under the headings "Description of the
Business  Reserves Estimates", "Other Oil and Gas Information" and "Supplemental Oil and Gas Information" and elsewhere may be deemed to be forward-looking
statements as they involve the implied assessment that the resources described can be profitably produced in the future, based on certain estimates and assumptions.

Often,
but not always, forward-looking statements use words or phrases such as: "expects", "does not expect" or "is expected", "anticipates" or "does not anticipate", "plans" or
"planned", "estimates" or

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"estimated",
"projects" or "projected", "forecasts" or "forecasted", "believes", "intends", "likely", "possible", "probable", "scheduled", "positioned", "goals" or "objectives", or state that certain
actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.

Various
assumptions were used in drawing the conclusions or making the forecasts and projections contained in the forward-looking statements throughout this Form 40-F.
In particular, statements which discuss business plans for drilling, exploration and development in 2007 assume that the extraction of crude oil, natural gas and natural gas liquids remains economic.
For the purposes of preparing this Form 40-F, the Registrant assumed a US$65/bbl West Texas Intermediate oil price, a US$7.50/mmbtu New York Mercantile Exchange natural gas
price, a US$/C$ exchange rate of $0.90 and a C$/£ exchange rate of $2.05 in 2007. This Form 40-F also discusses cash provided by operating activities for 2007.
The material assumptions used in determining estimates of cash provided by operating activities are: the anticipated production volumes described in the "2007 Outlook Summary" section of the
Registrant's Management's Discussion and Analysis; estimates of realized sales prices, which are in turn driven by benchmark prices, quality differentials and the impact of exchange rates; estimated
royalty rates; estimated operating expenses; estimated transportation expenses; estimated general and administrative expenses; estimated interest expense, including the level of capitalized interest;
anticipated cash payments made by the Registrant upon surrender of outstanding stock options using the cash payment feature, which in turn are dependent on the trading level of the Registrant's common
shares and the number of stock options surrendered or exercised; and the anticipated amount of cash income tax and petroleum revenue tax.

Forecasted
production volumes are based on the mid-point of the estimated production range. Statements regarding estimated future production and production growth, as well as
estimated financial results which are derived from or depend upon future production estimates (such as cash provided by operating activities) incorporate the estimated impact of the sale of the
Registrant's indirect Syncrude interest which was completed on January 2, 2007, the anticipated completion of the UK Brae asset sale and the non-core asset disposition
program in Canada. The completion of any contemplated asset dispositions is contingent on various factors including favorable market conditions, the ability of the Registrant to negotiate acceptable
terms of sale and receipt of any required approvals for such dispositions. The amount of taxes and cash payments made upon surrender of existing stock options and other estimates are inherently
difficult to predict.

Undue
reliance should not be placed on forward-looking statements. Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks
and uncertainties, which could cause actual results to differ materially from those anticipated by the Registrant and described in the forward-looking statements. These risks and uncertainties
include:



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Readers
are cautioned that the foregoing list of risks and uncertainties is not exhaustive. Additional information on these and other factors which could affect the Registrant's
operations or financial results are included under: (1) the heading "Risk Factors" in the Annual Information Form; (2) in the Report on Reserves Data by the Registrant's Internal
Qualified Reserves Evaluator and the Report of Management and Directors on Oil and Gas Disclosure, attached as schedules to the Annual Information Form; (3) the headings "Risk Factors",
"Segmented Results Review of Continuing Operations" and "Sensitivities" in the Management's Discussion and Analysis; and (4) elsewhere in the Annual Information Form and Management's Discussion
and Analysis. Additional information may also be found in the Registrant's other reports on file with Canadian securities regulatory authorities and the Commission.

Forward-looking
statements are based on the estimates and opinions of the Registrant's management at the time the statements are made. The Registrant assumes no obligation to update
forward-looking statements should circumstances or management's estimates or opinions change, except as required by law.

NOTE TO UNITED STATES READERS   DIFFERENCES IN UNITED STATES AND  CANADIAN REPORTING PRACTICES

The Registrant is permitted, under a multijurisdictional disclosure system adopted by the United States, to prepare this annual report in accordance with
Canadian disclosure requirements, which are different from those of the United States. The Registrant prepares its financial statements, which are filed with this Annual Report on
Form 40-F, in accordance with Canadian generally accepted accounting principles ("GAAP"), and they may be subject to Canadian auditing and auditor independence standards. They may
not be comparable to financial statements of United States companies. Significant differences between Canadian GAAP and United States GAAP are described in note 20 of the
comparative audited consolidated financial statements of the Registrant.

Acquiring,
holding or disposing of the Registrant's securities may subject you to tax consequences both in the United States and Canada. Tax consequences of acquiring, holding and
disposing of our securities are not described in this Annual Report.

CONTROLS AND PROCEDURES

As of the end of the period covered by this Annual Report, an evaluation was carried out under the supervision of and with the participation of the Registrant's
management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operations of the Registrant's disclosure controls and procedures
(as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation the Chief Executive Officer and Chief Financial Officer
concluded that the design and operation of these disclosure controls and procedures were effective in ensuring that information required to be disclosed by the Registrant in reports that it files with
or submits to the Commission is recorded, processed, summarized and reported within the time periods required.

It
should be noted that while the Registrant's Chief Executive Officer and Chief Financial Officer believe that the Registrant's disclosure controls and procedures provide a reasonable
level of assurance that they are effective, they do not expect that the Registrant's disclosure controls and procedures or internal control over financial reporting will prevent all errors and fraud.
A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

Management
is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f)
and 15d-15(f) under the Exchange Act.

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Management
has conducted an evaluation of the Registrant's internal control over financial reporting based on criteria established in the Internal
Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").

Based
on the management's assessment as of December 31, 2006, the end of the Registrant's fiscal year, management concludes that the Registrant's internal control over financial
reporting is effective.

Management
reviewed the results of management's assessment with the Audit Committee of the Registrant's Board of Directors. The Registrant's independent registered public accounting
firm, Ernst & Young LLP, audited management's assessment and independently assessed the effectiveness of the Registrant's internal control over financial reporting. Ernst &
Young LLP's attestation is located in the Independent Auditors' Report on Internal Controls under Standards of The Public Company Accounting Oversight Board (United States) which is
incorporated by reference in this Annual Report on Form 40-F as Exhibit 99.8.

Inherent Limitations on Effectiveness of Controls

Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of the
Registrant's financial statements would be prevented or detected. Further, the evaluation of the effectiveness of internal control over financial reporting was made as of a specific date, and
continued effectiveness in future periods is subject to the risks that controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies
or procedures.

No
changes were made in the Registrant's internal control over financial reporting during the fiscal year ended December 31, 2006 that have materially affected or are reasonably
likely to materially affect the Registrant's internal control over financial reporting.

AUDIT COMMITTEE FINANCIAL EXPERT

The Registrant's Board of Directors has determined that Robert G. Welty, a member of the Audit Committee, qualifies as an audit committee financial expert
(as defined in Item 401 of Regulation S-K under the Exchange Act) and is independent as defined by the New York Stock Exchange Corporate Governance Rules.

AUDIT COMMITTEE INFORMATION, AUDITOR FEES AND CODE OF ETHICS

The following information is included in the Registrant's Statement of Corporate Governance Practices contained in Schedule A of the Registrant's
Management Proxy Circular (excluding the portion thereof which appears under the heading "Audit Committee Report") and Schedule C of the Registrant's Annual Information Form:



OFF-BALANCE SHEET TRANSACTIONS AND CONTRACTUAL OBLIGATIONS

Information regarding off-balance sheet transactions and contractual obligations of the Registrant is included in Management's Discussion and Analysis
of the Registrant and notes seven, 11 and 12 of the comparative audited consolidated financial statements of the Registrant, which are incorporated by reference in this Annual Report on
Form 40-F.

UNDERTAKING

The Registrant undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the Commission staff, and to furnish
promptly, when requested to do so by the Commission staff, information relating to: the securities registered pursuant to Form 40-F; the securities in relation to which the
obligation to file an Annual Report on Form 40-F arises; or transactions in said securities.

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CONSENT TO SERVICE OF PROCESS

The Registrant has previously filed with the Commission a written consent to service of process and power of attorney on Form F-X. Any change
to the name or address of the Registrant's agent for service shall be communicated promptly to the Commission by amendment to the Form F-X referring the file number of
the Registrant.

SIGNATURES

Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form 40-F
and has duly caused this Annual Report to be signed on its behalf by the undersigned, thereto duly authorized.

|Registrant:          |  | TALISMAN ENERGY INC.
|-------------------- |  | --------------------
|                     |  | By:                 
|Date: March 13, 2007 |  |                     

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EXHIBIT INDEX

|Exhibits |  | Description                                                                                                                                                                                                                                      
|-------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|99.1     |  | Certificates of the Chief Executive Officer and Chief Financial Officer under Sections 302 and 404 of theSarbanes-Oxley Act of 2002.                                                                                                             
|99.2     |  | Certificates of the Chief Executive Officer and Chief Financial Officer under Section 906 of theSarbanes-Oxley Act of 2002.                                                                                                                      
|99.3     |  | Consent of Ernst & Young LLP.                                                                                                                                                                                                                    
|99.4     |  | Consent of Michael Adams, Internal Qualified Reserves Evaluator.                                                                                                                                                                                 
|99.5     |  | Annual Information Form of the Registrant dated March 13, 2007.                                                                                                                                                                                  
|99.6     |  | Management's Discussion and Analysis of the Registrant dated March 13, 2007.                                                                                                                                                                     
|99.7     |  | Comparative audited consolidated financial statements of the Registrant, including notes thereto, together with Independent Auditors' Report thereon for the year ended December 31, 2006.                                                       
|99.8     |  | Independent Auditors' Report on Internal Controls Under Standards of The Public Company Accounting Oversight Board (United States) as at December 31, 2006.                                                                                      
|99.9     |  | Statement of Corporate Governance Practices of the Registrant contained in Schedule A of the Registrant's Management Proxy Circular dated March 13, 2007, excluding the portion thereof which appears under the heading "Audit Committee
Report".

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