BG. Gas prices over 14% up recently with more to come - global LNG expanding and further exploration rights --- about to break out.

http://www.moneyam.com/action/news/showArticle?id=989336

dikytree.

3rd Quarter Results

Third Quarter Key Points


· Earnings down 4% to $1.1 billion; total operating profit 15% lower at $1.8 billion

· Production down 10%; reduced activity in the US, declines in Egypt and planned shutdowns

· Further progress with 2013 milestones; Margarita Phase 2 and Bongkot North Phase 3K now onstream

· QCLNG entering commissioning phase; entire export pipeline in the ground with testing underway

· Excellent flow rates from FPSOs 1, 2 and 3 in Brazil; gross production around 160 000 boed

· Good progress with portfolio management; agreed sale of US midstream assets, Quintero LNG disposal

· Egyptian domestic offtake higher in Q3; business environment remains difficult

Declaration of Commerciality for the Carioca area, offshore Brazil
BG Group today confirms that its partner, Petróleo Brasileiro S.A. (Petrobras) - the operator of block BM-S-9 in the pre-salt Santos Basin - has submitted a Declaration of Commerciality (DoC) to the Brazilian National Agency of Petroleum, Natural Gas and Biofuels (ANP), for the oil and gas accumulations in the Carioca area, offshore Brazil.

As part of the DoC, the consortium has suggested that the new field be named Lapa.

The Lapa field is located approximately 270 kilometres off the coast of São Paulo state, in water depths of around 2 140 metres. The DoC notification to the ANP also includes the operator's estimates of total recoverable volumes associated with the initial stage of development.

BG Group is working with the consortium partners to achieve further optimisation of the development plan following encouraging results from the recent Carioca SW appraisal well drilled in October 2013.

The DoC submission was accompanied by the Final Report of the Discovery Assessment Plan following an exploration and appraisal programme which began in 2007 and consisted of acquiring 3D seismic, drilling five wells as well as performing three formations tests and an extended well test.

The Development Plan for the Lapa field will be submitted for ANP approval within the next 180 days.

BG Group has a 30% interest in the BM-S-9 concession, offshore Brazil (Petrobras, operator 45%, Repsol Sinopec Brasil 25%).

Minor Gold cross albeit on low volume.

BG. Looks like an interesting short to med term trading opportunity arising here. Anyone for 1350p in the rising trend channel. This coincides with last years resistance.

BG Group - Declares Force Majeure in Egypt; gives 2013 results expectations and 2014 outlook*

BG Group has today issued Force Majeure notices under its LNG agreements in Egypt reflecting the ongoing diversions of gas volumes to the domestic market in excess of the existing pooling arrangements.

The Group will publish its preliminary 2013 fourth quarter and full year results on 4 February 2014. Currently the Group expects to report:

· 2013 production volumes of around 633 thousand barrels of oil equivalent per day (kboed), in line with guidance
· LNG Shipping & Marketing total operating profit of approximately $2.6 billion, in line with guidance
· Business performance** earnings flat at approximately $4.4 billion (around 130 cents per share)
· Non-cash, post-tax impairments of approximately $2.4 billion associated with Egypt (around
$1.3 billion) and the US (around $1.1 billion)
· Total results earnings (post impairments) of approximately $2.2 billion (around 65 cents per share)

The Group also today updates on its outlook for 2014:

· 2014 production volumes expected in the range of 590 - 630 kboed
· 2014 E&P unit operating costs expected to be $15.50 - 16.25 per boe
· 2014 E&P unit depreciation costs expected to be $12.25 - 13.00 per boe
· 2014 LNG Shipping & Marketing total operating profit expected in the range of $2.1 - 2.4 billion

For 2015, BG Group expects production volumes to be in the range of 710 - 750 kboed excluding portfolio changes, and continues to expect to be free cash flow positive*** in 2015 at the Group's reference conditions.

UBS comment:
"BG expects 2013 production at 633kboed, in line with the guidance at 630 660kboed and UBSe 633kboed. LNG earnings will come at $2.6bn, at the mid-point of the guidance and vs. UBSe $2.572bn. Recurring net income will amount to $4.4bn (UBSe $4.3bn), but big impairments will be taken against Egypt ($1.3bn) and the US ($1.1bn). Tax rate is expected to average 41% (UBSe 42%).
2014 production is guided to 590-630kboed (UBSe 670kboed); LNG earnings to $2.1- $2.4bn (UBSe $2.69bn). Average unit costs are also expected to be higher, primarily on start up unit costs related to Brazil and Australia, with opex at $15.50-$16.25/bbl vs. UBSe $12.78/boe and DD&A $12.25-$13/boe vs. UBSe $11.46/boe. 2015 production guidance of 710-750kboed is a 9% downgrade on the mid-point vs. previous expectations (UBSe 776kboed). 2015 LNG earnings are expected to be similar to 2014 (UBSe $2.9bn). Effective tax rate should remain around 41%. BG still sees itself FCFpositive starting from 2015, which is a compensation but potentially capex related.
The Force Majeure declared in Egypt reflects the ongoing diversion of gas volumes to the domestic market in excess of the existing pooling arrangements (currently close to capacity of 1Bcfd). The US impairment stems from lower forward gas prices and hence continued low rig count. 2014 is also impacted by delays in Brazil plus maintenance in the north Sea and PSC effects in Trinidad and Tobago. The announcement is disappointing and affecting management credibility and the BG investment case."

Beaufort Securities Buy 1,085.00 - - Retains

Citigroup Buy 1,085.00 1,510.00 1,400.00 Reiterates

JP Morgan Cazenove Neutral 1,085.00 1,550.00 1,300.00 Downgrades

Nomura Buy 1,085.00 1,450.00 1,350.00 Reiterates

Credit Suisse Neutral 1,085.00 1,200.00 1,115.00 Upgrades

Deutsche Bank Buy 1,085.00 1,400.00 1,250.00 Reiterates

Goldman Sachs Conviction Buy 1,078.00 1,082.00 - 1,580.00 Reiterates

Barclays Capital Equal weight 1,078.00 1,082.00 - 1,370.00 Reiterates

HSBC Overweight 1,079.50 1,082.00 1,425.00 1,325.00 Reiterates

Can't make up my mind whether to buy any at this level. Historically the sp seems to regularly fall off a cliff and then slowly build back up again. Shame the divi yield isn't that great.

I've had a dabble @1075 £10 has been support on several occasions.

Investec Sell 1,079.75 1,082.00 1,100.00 1,000.00 Retains

Societe Generale Hold 1,079.75 1,082.00 1,400.00 1,200.00 Retains

BG Group seems to have got it wrong in Egypt and the US, yet it is hard to lay responsibility for the write-downs in either region at the company's door. The group's fortunes will be decided not in either of those two jurisdictions but in Australia and Brazil. By Credit Suisse's - no cheerleader for the stock - calculations, production from the outfit will rise to just under 1.2m barrels of oil equivalent by 2020, from just over 600,000 at present. Rose tinted glasses aside, that is all very well and good but after Monday's warning the stock will be left trading at a forward price-to-earnings multiple of approximately of 15, versus roughly 10 times earnings over at Shell and BP. And on what basis? The company's own production targets? This is an outfit which has cut its own estimates on four occasions throughout the last 18 months, Deutsche bank reminds us. That multiple prices in a lot of confidence that the company can deliver, says the Financial Times' Lex column.

Reaching support level. Am thinking about investing sub £10.

Harry yes £8 would suit us.

Hmmmmmm....£8 might be a bit optomistic.

Added a few today @1,019.

Final results

Full Year Key Points
· Business Performance total operating profit down 5% at $7.6 billion
· Upstream total operating profit down 9%; LNG Shipping & Marketing (S&M) up 3%
· Delivered all 10 key milestones in 2013; continued to make progress in Brazil and Australia
· Business Performance EPS flat at 128.6 cents; total results EPS down 33% at 64.8 cents
· Total results included non-cash post-tax impairments in Egypt and US totalling $2.4 billion
· Issued Force Majeure notices in respect of LNG agreements in Egypt
· Full year dividend increased by 10% to 28.75 cents per share (18.02 pence per share)

· 2014 production outlook of 590 - 630 kboed; 2014 profit outlook for LNG S&M at $2.1 - $2.4 billion
· 2014 unit operating costs range $15.50 - 16.25 / boe; Unit DD&A costs range $12.25 - 13.00 / boe
· 2015 production outlook of 710 - 750 kboed: expect to be free cash flow positive in 2015

Ex-divi wed 23rd Apr (9.51p)

1st Quarter results

First Quarter Key Points

· Business Performance EPS down 3% to 33.8 cents; Total EPS down 9% to 32.4 cents

· Net cash flow from operating activities up 6% to $2.4 billion

· E&P production volumes down 4% at 633 kboed

· LNG segment total operating profit down 7%; no BG Group cargoes from Egyptian LNG

· Egyptian domestic offtake exceeded contractual commitments; deteriorating reservoir performance

· Good progress in Australia and Brazil with key milestones delivered

· Group's exposure to commodity prices and foreign exchange rates 50 - 70% hedged in 2014