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Stock Exchange Announcement 10 May 2001

BG Group announces First Quarter Results for 2001


BG Group plc today announced its First Quarter results for 2001, marking a strong start to the year.

Total operating profit* rose by 30 per cent to £232 million. Underlying performance has continued to improve and, excluding the impact of changes in gas and oil prices in the upstream business, the Group's total operating profit* rose by 21 per cent.

Earnings* increased by 12 per cent to £136 million and earnings per share* rose by 11 per cent to 3.9 pence in the First Quarter.

BG Group Chairman Richard Giordano said: "BG Group made a good start to the year and continued to deliver strong profit and earnings growth in the first quarter."

Chief Executive Frank Chapman said: "These are excellent results which demonstrate the achievement of a series of important milestones and good progress being made towards our published targets."

Highlights of the First Quarter results include the Elgin field in the UK North Sea achieving first production in March and the Rosetta field in Egypt, coming onstream in January.

The major agreement signed in April with the Egyptian General Petroleum Corporation put in place the commercial framework for the development of an integrated liquefied natural gas export project in Egypt. BG has the largest uncontracted gas reserves in the country.

In April, BG was granted firm access to transport gas through the Bolivia-Brazil pipeline and secured a gas sales agreement allowing 3.1 million cubic metres of gas a day of its Bolivian equity gas to be sold to BG's Brazilian gas distribution company, Comgas.

The results of the testing of the Kashagan West -1 well in the Caspian were announced on May 3. The well, spudded in October last year, flowed at a rate of up to 3,400 barrels of oil per day and 7.6 million standard cubic feet of gas per day. Kashagan West-1 is the second successful well drilled by the North Caspian Sea Consortium, of which BG is a member.

In April, the House of Lords ruled in favour of the owners of the Central Area Transmission System (CATS) pipeline in their dispute with Teesside Gas Transportation Limited. BG's share of the award was approximately £51 million, including interest.

The partial sell-down of BG's Northern Ireland distribution company, Phoenix Natural Gas for approximately £50 million was completed successfully in March, and Storage's auction of annual capacity for the Rough and Hornsea facilities achieved prices around 40 per cent higher than last year. Bidding for Rough capacity was nearly six times that on offer.

(*Continuing operations excluding exceptional items)

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