Saturday 9 May 2015
BG Group has reported a near 40 per cent fall North Sea production amid disruptions caused by repairs and maintenance work.
The oil and gas firm, which has recommended a £47bn bid from Shell, produced 77,000 barrels oil equivalent per day in the UK in the first quarter. This was down 38 per cent on the 125,000 boed produced in the same period last year.
The big fall in output came after four fields were shut down temporarily to allow work to be done on the CATS gas pipeline and the Lomond production platform.
The fall shows how infrastructure issues can have a big impact on production in areas such as the North Sea, with implications for revenues and costs.
It compounded the effect of the sharp drop in the price of crude between June and the first quarter.
Reading-based BG’s profits fell by 40 per cent in the three months to March, to $1.6bn (£1bn) from $2.7bn
The price of Brent crude has increased by around 20 per cent since Shell made a cash and shares bid for BG on 8 April, which has been recommended by the BG board.
The rise in the oil price since the end of the first quarter has prompted some to question if Shell has offered a fair price for BG.
However, BG’s chief executive Helge Lund told reporters: “There is no change to our view on the offer,”
The takeover, which is due to complete next year, could be followed by big cuts in the combined North Sea portfolios of Shell and BG.
When Shell announced first quarter results last week its chief financial officer Simon Henry indicated the company planned to speed up its retreat from the North Sea.
He said BG had some good North Sea assets but added: “Shell is not necessarily a natural owner of assets in the North Sea.” Mr Henry said other companies may have more expertise and incentive to squeeze the value from mature assets.
There have been fears that the takeover will result in job losses in Aberdeen, where Shell and BG have their North Sea headquarters.
Shell has highlighted the potential to cut costs through the ‘de-duplification’ of administrative functions.
BG cut capital investment in new North Sea projects to $109m in the first quarter, from $130m last time. Exploration spending tripled to $42m, from $14m.
While affirming the BG board’s support for the Shell offer, Mr Lund said yesterday he had mixed emotions about the deal. He said he had not expected a takeover when he took charge of BG in February, after a successful career at Statoil.
The fall in BG’s UK production was offset by big increases in output in Brazil and Australia. Shell has highlighted the appeal of BG’s deepwater acreage off Brazil and its liquefied natural gas production in Australia.
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Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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A head-cut image of Alfred Donovan (now deceased) appears courtesy of The Wall Street Journal.
