UK: BG Delivered 88 LNG Cargoes in H1

BG Delivered 88 LNG Cargoes in H1

BG Group of UK said on Friday it has delivered 88 LNG cargoes in the first half of this year, 11 fewer than in the first half of 2012, due to the disruptions in Nigeria, which lead to the loss of three cargoes, fewer spot cargoes and reduced liftings from Egypt.

First half cargo deliveries comprised 58 to Asia, 22 to South America , five to the USA , two to Europe and one to Mexico (2012: 61 Asia, 26 South America , nine USA and three Europe).

LNG Shipping & Marketing total operating profit increased 2% to $1 263 million, as the benefit of lower hedging losses was largely offset by fewer cargo deliveries and the impact of reduced margins, predominantly as a result of the pricing change on cargoes delivered to Chile.

BG Group delivered 39 LNG cargoes in the second quarter of 2013, seven fewer than in the second quarter of 2012.

BG Group’s Chief Executive, Chris Finlayson said: “I’m pleased with our execution progress in the second quarter of 2013 as we successfully delivered both of our two key production milestones. The third FPSO vessel offshore Brazil started commercial production on time and on budget, and we also completed the major planned maintenance shutdown and re-start of the giant Karachaganak field in Kazakhstan, safely and ahead of schedule.

“We have delivered the five key milestones promised for the first half of the year and also continued to de-risk the five remaining for the second half. At the same time, we have continued to progress with our major growth projects, in the Santos Basin offshore Brazil and QCLNG in Australia, which are both on track.

“In the second quarter, earnings were down 3%, reflecting lower volumes and higher unit operating and depreciation costs in the Upstream segment. Both of these costs are expected to be around 50 cents per boe higher for full-year 2013 than originally forecast. LNG Shipping & Marketing results were up 1% from a year ago, despite fewer cargoes from Nigeria and Egypt. Assuming no further major disruptions in the balance of the year, we reiterate our 2013 LNG Shipping & Marketing total operating profit guidance range of $2.5 billion to $2.7 billion. All other guidance for the year also remains unchanged.”

Addressing the civil unrest and political changes in Egypt, Chris said: “Events in Egypt remain a primary concern and will continue to be so as the political, social and business environment evolves. While our offshore operations continue unaffected, higher than agreed gas volumes were diverted into the Egyptian domestic market during the quarter, impacting volumes available for LNG export. An agreement between Egypt and Qatar for an initial five compensatory LNG cargoes, with two allocated to BG Group, is a positive development.”

On the Group’s major projects, Chris said: “In Australia, we made substantial progress on the QCLNG project and we are on track for both first LNG in 2014 and the $20.4 billion budget. In total, we have now drilled three quarters of the 2 000 wells needed to supply the first two LNG trains. On Curtis Island, the second storage tank roof was successfully and safely raised into place.

“In Brazil, there have been a number of important points of progress. Test results from our fourth appraisal well at Iara have shown excellent reservoir deliverability characteristics, significantly better than the Iara discovery well. These results are very positive for potential recoverable reserves and resources in Iara, which has oil in place comparable to Lula. The next two FPSOs due to start in 2014 are progressing well, with one already in Brazil for topsides integration. We are delighted to have won 10 offshore blocks in the Barreirinhas Basin, along the northern coastline, which we expect to expand further our inventory of high-impact exploration opportunities.

“Elsewhere, in Tanzania we recorded an eighth consecutive discovery, Ngisi-1 in Block 4, and our total gross recoverable resource estimate for all our discoveries offshore Tanzania has increased to around 13 tcf. The site selection process for the LNG plant is progressing well.”

In conclusion, Chris said: “We have successfully delivered all our key milestones for the first half of 2013 as well as making good progress on the remaining milestones for the year. At the same time, we are making good headway on our major growth projects.”

[mappress]
LNG World News Staff, July 26, 2013; Image: BG

 

 

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