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.

StockMarketWire.com
BG Group upgraded to buy from hold at Deutsche, TP raised to 1500p from 1330p.

BG Group has confirmed a new discovery of light oil in block BM-S-9 in the Santos Basin, offshore Brazil.

The discovery well 3-BRSA-861-SPS - informally known as Carioca North-East - is located in a water depth of 2 151 metres, approximately 275 kilometres off the coast of S Paulo state and nine kilometres north-east of the original Carioca discovery well.

Initial analysis of the discovery has confirmed the presence of a light oil accumulation (approximately 26 API) in a 200-metre reservoir section.

Drilling on Carioca North-East has been concluded and drill stem tests will be conducted in due course.

BG Group has a 30% interest in block BM-S-9 which is comprised of two appraisal areas - Guarand Carioca (Petrobras 45%, operator and Repsol 25%).

Blue Chip Bulletin: BG Group venture confirms quality oil site

http://www.whatinvestment.co.uk/trading/share-dealing/uk-companies/1606523/blue-chip-bulletin-bg-group-venture-confirms-quality-oil-site.thtml

BG takes tax hit
StockMarketWire.com
Oil and gas producer BG Group said higher UK North Sea tax will reduce first-quarter earnings by $265m. Total Q1 operating profit was up 1% at $1.965bn.

LNG operating profit for 2011 is expected towards upper end of $1.9bn to $2.2bn range.

Revenue and other operating income increased by 7% to $4.803bn, reflecting the benefit of higher realised prices, partially offset by lower E&P production volumes.

Total operating profit of $1.965bn was 1% higher, as the increase in revenue and other operating income was offset by a higher exploration charge and lower profits from the LNG segment.

Cash generated by operations was $1.799bn, in line with fourth quarter 2010, but 28% lower than last year, principally reflecting changes in working capital associated with margin calls on the Group's hedged LNG contracts. The cash outflow associated with margin calls will reverse in future periods when the underlying LNG contracts settle.

Net finance costs were $79m (2010 $10m) included foreign exchange losses of $22m (2010 $51m gains).

The Group's effective tax rate (including BG Group's share of joint venture and associates' tax) for 2011 increased to 45% (2010 42%) primarily as a result of the recently announced change in UK North Sea taxation. This increase in UK taxation led to an additional charge of $265m, consisting of a $62m charge for the quarter in addition to a one-off tax charge of $203m in respect of the revision of opening deferred tax balances. Taking into account this tax rate change, the Group's effective tax rate is expected to be 43% to 44% in the near term and trend downwards thereafter as more of the Group's profits are generated from outside of the North Sea.

As at 31st March 2011, the Group's net debt was $8.51bn, with an average maturity of around 9 years, and the gearing ratio was 23%.

In the quarter, capital expenditure was 21% higher at $2.296bn (including acquisitions of $319m).

A post-tax charge of $223mfor the quarter (2010 $66m credit) was recorded in respect of disposals, re-measurements and impairments.

Group CEO, Frank Chapman said: 'It was a challenging quarter for our E&P operations, with civil unrest in North Africa, flooding in Australia, an increase in UK tax and a shutdown in the North Sea. We now expect modest production growth in 2011. The plans for a ramp-up in production in 2012 and 2013, as well as our 2020 goals, are unaffected and are supported by significant progress with our growth projects in Brazil, the USA and Australia, as well as further exploration and appraisal success in Brazil and Tanzania.'

Any views on why the SP seems to be falling so rapidly? The changed north sea tax regime is surely not the answer?

BG Group raises Santos Basin net potential to 8 billion barrels of oil equivalent


BG Group today issued a material upgrade for its interests in the pre-salt Santos Basin, offshore Brazil. Mean Total Reserves and Resources* are now estimated to amount to some 6 billion barrels of oil equivalent (boe) net to BG Group, with an upside potential of 8 billion boe net. Existing discoveries account for 96% of the mean Total Reserves and Resources.

The mean Total Reserves and Resources represents a doubling of BG Group's previous best estimate of 3 billion boe prevailing at the time of the Group's February 2010 Strategy Presentation.

Half Year Results.

RNS Number : 0281L

BG GROUP plc

26 July 2011

BG Group plc

2011 SECOND QUARTER & HALF YEAR RESULTS

Second Quarter Key Points

-- Earnings up 27%; cash generated by operations up 11%

-- Interim dividend of 10.8 cents per share, up 10%

-- Reserves and resources doubled in Brazil since 2010; upside potential now 8 billion boe net

-- Brazil reservoir performance significantly reduces unit costs; unit resource value increased

-- Lifted first one million barrels of equity oil from Lula field

-- Assumed operatorship offshore Tanzania; agreements to operate offshore Kenya

BG Group's Chief Executive, Sir Frank Chapman said:

"We made good progress in both our E&P and LNG businesses. In Brazil, we saw major increases in our reserves and resources; with the new resources delivering a higher unit value as their production is expected to require no additional surface facilities. We have invested $4.4bn in organic growth in the first half and made good progress across our major growth projects in Australia, Brazil and the USA; progress that continues to de-risk the delivery of our growth programme."

Edited - wrong thread!

A touch of dyslexia, skinny???

Harry - I had an early start :-)

From FT:
"Chinese oil companies have been circling BGs fast-growing Brazilian business, according to people familiar with the situation. Several industry specialists said BG had considered the sale of a minority stake in its thriving oil and gas business and that Chinese oil companies had been among those interested in the asset.

One person familar with the matter said there had been talks with at least one Chinese oil company. Among the companies rumoured as potential investors include China National Petroleum Corp and Sinopec, the nations largest refiner. The companies declined to comment
BG has got fantastic discoveries. The question is how do they pay for it all, said one of the people familiar with the matter. One option is to bring in a partner."

Shares in BG Group were helped higher by speculation that two Chinese oil companies are interested in acquiring BGs Brazilian business, which UniCredit believes could act as a catalyst for the stock.

Given the recent resource estimates increase, it is possible that BG is considering ways to fund its Brazilian developments. This is why the article could act as a catalyst for the stock, given that a potential disposal of part of the assets could add significant value to the stock, said analyst Stefano Vitali.

UniCredit raises the target price on the stock to 1,880p, from 1,800p, and retains its buy recommendation.

Note from Golman Sachs:
"BGs share price performance this year has been lackluster: down 12% ytd in US$ terms, barely outperforming its peers. Yet, the outlook across its business has improved materially: LNG pricing is up 77% ytd; the resource base in Brazil has doubled in size; the Tanzania acreage has yielded interesting discoveries. BG is the only European integrated oil company on the global GS SUSTAIN Focus List, which identifies companies that are likely to maintain returns leadership through superior industrial positioning and ESG scores. We expect BGs high-return, high-impact portfolio to underpin sector leading growth for the next decade.

3Q results are not likely to be a catalyst for the stock, given that high maintenance in the North Sea is likely to dampen E&P results. We believe the key event in the next six months is the February strategy presentation, which has consistently been a positive catalyst for the past six years. We also believe the 4Q results could show very strong profitability in LNG, as the spread vs. Henry Hub is at historical highs, while E&P would benefit from the re-start of the North Sea production. BGs exposure to some of the most attractive new hydrocarbon developments in the world (Brazil deepwater, CBM to LNG in Australia, unconventional gas in the US) could attract the interest of NOCs eager to gain access to these new technological frontiers. We believe that BG could do some very attractive farm-outs of its assets."

Back in these today @1207.

.
Rumours around again today of a chinese interest.

3rd Quarter Results.

Total operating profit up 17% year-on-year to $1.9 billion

Cash flow from operations up 59% year-on-year to $2.7 billion

Production up 1%, held back by outages at UK facilities which are now back onstream

2011 LNG total operating profit now expected to be above guidance at some $2.4 billion

Long-term LNG supply agreement signed with Gujarat State Petroleum Corporation, India

Lula to Mexilh gas pipeline, offshore Brazil, commenced operations

All 13 first phase FPSO vessels now committed for BM-S-9 and BM-S-11, offshore Brazil

Good progress on the QCLNG project, with $1.3 billion invested in the quarter

In October, $3 billion of bonds issued with maturities from five to thirty years

Broker note from SocGen:
BG surprised positively on Q3 adjusted divisional EBIT and net income and raised its FY 11 LNG profit guidance from $2.2bn to $2.4bn. Q3 group adjusted EBIT at $1,943m (inc. affiliates) was up 17% year on year, beating consensus by 2.7% on the back of improved performances in both E&P and LNG. Upstream EBIT at $1,183m was up 55% year on year, benefiting from 0.7% higher production and higher realised prices (gas realisations +20%) and somewhat lower exploration charges. UK output was nevertheless 39% below BGs own plan, partly due to slow commissioning of the Buzzard field, and also integrity-related field shutdowns. Unit opex of $8.96/boe was in line with SGe, reflecting the cost of maintenance. Q3 LNG EBIT of $620m was 11% better than SGe but 14% below year earlier levels due to lower LNG Shipping/marketing profit. Note though that the Q3 LNG result was sufficiently ahead of BGs internal expectations, prompting the group to raise guidance for full year EBIT from $2.2bn to $2.4bn. We note that BG diverted 89% of its cargoes (vs 78% in 2010) to non US markets.
We reiterate our Buy rating with a 17 TP (average of a SOP and a DCF (WACC 10.6%)). BG offers a low cost entry into a sizeable and growing resource opportunity; if access to resources is the industrys key challenge, then BG is in our view a near perfect vehicle to gain entry into a 20bnboe resource base. If LNG is going to be a market in which growth is supply, rather than demand, constrained, then again BG is the way to gain exposure.

RNS Number : 9365T

Bg Group plc

14 December 2011



News Release

14 December 2011

Agreement reached with Republic of Kazakhstan on Karachaganak

Bg Group today announced that the Republic of Kazakhstan (RoK) and the contracting companies in the giant Karachaganak gas-condensate field in north-west Kazakhstan have reached an agreement that will support the further development of the field.

The agreement, effective from 30 June 2012 on satisfaction of conditions precedent, involves Kazakhstan's KazMunaiGas (KMG) acquiring a 10% interest in the project. This will be done by each of the contracting companies transferring 10% of their rights and interest in the Karachaganak Final Production Sharing Agreement (FPSA) to KMG.

The pre-tax consideration under the agreement to the Karachaganak contracting companies is $3 billion dollars. The key elements are:

-- The contracting companies will receive $1.5 billion cash pre-tax consideration from RoK in exchange for a 5% interest, to be held by KMG, in the FPSA.

-- The contracting companies will receive a further $1.5 billion pre-tax consideration, comprising $500 million cash and $1 billion non-cash consideration, in exchange for transferring a second 5% interest in the FPSA to KMG. The non-cash consideration includes final and irrevocable settlement of cost recovery and other related claims and the allocation of an additional 2 million tonnes per annum capacity for the Karachaganak project in the Caspian Pipeline Consortium export pipeline.

-- The contracting companies will be responsible for paying tax of $1 billion on the total consideration.

-- The contracting companies will make a $1 billion loan to KMG to be repaid in instalments over a three-year period. The loan will be repaid from the proceeds of KMG's share of oil and gas sales from its 10% interest, backed by a guarantee from Samruk-Kazyna, the Kazakhstan sovereign wealth fund.

Sir Frank Chapman, BG Group Chief Executive, said: "BG Group looks forward to working with KMG as a partner in the Karachaganak project, one of the world's largest gas and condensate fields. This agreement represents an excellent outcome for the project partners as well as for the government and people of Kazakhstan".

Ashley Almanza, BG Group Executive Vice President, said: "Karachaganak is estimated to have hydrocarbons initially in place of 9 billion barrels of condensate and 48 trillion cubic feet of gas - to date less than 10% of that resource has been produced. Today's agreement ensures strong alignment with the Republic of Kazakhstan and provides the foundation for realising the vast remaining potential and value in Karachaganak".

From the effective date of 30 June 2012, BG Group's interest in the Karachaganak project will reduce to 29.25% from the 32.5% previously held. The Group will remain joint operator with Eni, which will also hold 29.25% (currently 32.5%). Chevron will hold 18% (20%); LUKOIL 13.5% (15%); and KMG 10%.

The terms and conditions of the Final Production Sharing Agreement signed in 1997 for the development of the Karachaganak field are unchanged. In addition, the contracting companies and RoK have reached agreement on all tax affairs up to the end of 2009.

-ends-

RNS Number : 7872U
BG GROUP plc
30 December 2011


News Release

30 December 2011
Declaration of Commerciality for Guará area, offshore Brazil

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

The DoC marks the start of the production phase for the Guará field and is another significant milestone in the development of BG Group's large and high quality discoveries in the pre-salt Santos Basin.

In the proposal, filed with the regulatory agency 12 months ahead of the ultimate deadline, the consortium suggests that the field, comprising excellent reservoirs with good quality 30˚ API oil, be named Sapinhoá. The DoC notification to the ANP also includes the operator's estimates of total recoverable volumes associated with the initial stage of development.

The DoC, submitted following completion of an exploration and appraisal program that started in 2008, was accompanied by the Final Report on the Evaluation Plan. The Development Plan for the field will be submitted to ANP in February 2012.

Four wells were drilled in the area, including one well designed for reservoir data acquisition. Drill stem tests were performed on three of the wells. In addition, a five-month extended well test (EWT) was carried out on the discovery well, confirming the excellent productivity of the Guará reservoir. Data gathered from this EWT will assist in the optimisation of the field development plan.
BG Group has a 30% interest in the BM-S-9 concession, offshore Brazil (Petrobras, operator 45%, Repsol Sinopec Brasil 25%).

-ends-

BG Group 2011 Fourth Quarter and Full Year Results

Full Year Key Points
· Total operating profit up 19% to $8.2 billion

· Strong cash flow from operations, up 17% to $9.8 billion

· Full year dividend increased by 10% to 23.76 cents per share (14.82 pence per share)

· Significant progress on major projects in Australia and Brazil

· Signed 20-year US LNG export agreement for 5.5 mtpa, commencing 2015

· Three-year proved reserve replacement ratio exceeding 200%

· $5.6 billion bonds issued in dollar, sterling and euro currencies