The poorer than expected third quarter exploration and production performance might cause short term concern
British Gas Group yesterday reported a 34 per cent increase in third quarter profits due to strong oil and gas prices.
BG produced net profits of 215 million pounds, slightly lower than an expected City consensus of 218 million pounds. Its LNG division performed particularly strongly but exploration and production disappointed.
Problems at a Gazprom processing unit in Russia forced down volumes from the Karachaganak field in Kazakhstan where BG is a stakeholder. Moreover, BG was also forced to take a write-off of 34 mln pounds because of unsuccessful drilling and seismic work.
The Company?s CEO Frank Chapman still declared a "good set of figures" and predicted excellent progress for the rest of the year.
"The poorer than expected third quarter exploration and production performance might cause short term concern but we believe the company's (equity) rating is attractive versus BP and Shell."
