Updates from BG Group

Some updates from BG Group, including exploration operations and the resignation of Chris Finlayson, Chief Executive.

BG Group Chief Executive resignation

The BG Group Board has accepted Chris Finlayson's resignation as Chief Executive and as an Executive Director of the Board with immediate effect, for personal reasons.

Until a permanent replacement is appointed, Andrew Gould, BG Group’s Non-Executive Chairman, will take over as interim Executive Chairman. A recruitment process to find an external successor to Chris is now underway. Andrew will revert to the role of Non-Executive Chairman once the new Chief Executive is appointed.

Chris Finlayson: Appointed in 2011; Chief Executive in 2013.

New exploration basin, offshore Myanmar

BG Group announced earlier that it has been awarded new exploration acreage offshore Myanmar. BG Group will operate two blocks, A4 and AD2 (45% and 55% equity respectively). The company also secured non-operated acreage in blocks A7 and AD5 (45% equity in each). These are located in the Rakhine Basin, in the western offshore area of Myanmar and were awarded as part of the government's 2013 Offshore Bid Round.

BG Group and its bidding partners have committed to a 3D seismic acquisition programme in each block, which we expect to begin in 2014/15 with options for future drilling.

This award is in line with BG Group's strategy to focus on securing prospective frontier acreage and enter, on average, one new basin each year.

Business update and outlook

The company will announce its first quarter results on 1 May, including an update on the Group’s key projects, which remain on schedule.

In Australia, good progress continues, with the start-up of the Ruby Jo central processing plant and in Brazil, all four buoyancy supported risers are in position on FPSOs 2 and 3, with two new permanent wells connected. Commissioning of Bongkot South Phase 4b, the Group’s other first quarter milestone, was completed in February. 

Egypt remains challenging, with volumes in the first quarter declining 35% from the fourth quarter of 2013 to 66 000 barrels of boepd. This is a result of deteriorating reservoir performance and the high level of diversions to the domestic market, where the Group is entitled to a lower share of production.

The Group’s 2014 production guidance remains unchanged at 590 000 - 630 000 boepd, although production is now expected to be at the lower end of the range given the issues in Egypt. The deterioration in Egypt will similarly impact 2015 production.

The Group is reviewing its operational, investment and portfolio management plans and will not provide 2015 guidance until its full year results in February 2015.

Edited from various sources by Cecilia Rehn

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