BG Group profit rises 12% on commodity prices

UK energy giant BG Group reported a 12% increase in year-on-year net profit in the third quarter, driven by rising commodity prices and growth in its liquefied natural gas business.

The earnings data came as BG announced an upgrade to its oil fields in Brazil, and shortly after the company approved its largest ever overseas investment, a liquefied natural gas project in Australia.

BG said net earnings for the third quarter were $978 million, 27% higher than the same period a year earlier.

Total operating profit increased 7% to $761 million, the energy giant said, due to the increase in revenue and other operating income and a lower exploration charge, partially offset by a shutdown at a gas field in India and maintenance at a field in Kazakhstan.

BG shares advanced 37p, or 3%, to £12.27 in early trading after the earnings beat market expectations.

Meanwhile, the company upgraded its estimates of total recoverable resources for the Tupi, Iracema, and Guará fields in the Santos Basin, offshore Brazil, by 34% to 2.7 billion barrels of oil equivalent.

BG also said it plans to invest about $15 billion in developing the liquefaction plant in Queensland, Australia and related wells, field facilities and pipelines. The company noted that it has agreements in place to bring the liquefied gas to Chile, Japan, Singapore and China.

Operating profit for the company’s liquefied natural gas division grew to $725 million during the quarter, up 43% from the same period a year earlier. The growth was in part generated by diverting shipments of the gas to regions with more attractive prices. However, BG said it did not expect the division’s strong performance to continue into the fourth quarter.