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Q3 2011 Results and Strategy – BG Group

BG Group · Oct 10, 2011 · 41 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q3 2011 Results and Strategy – BG Group – slide 1
    BG Group: Q3 2011 Results & Strategy October 2011
  2. Q3 2011 Results and Strategy – BG Group – slide 2
    Legal Notice Certain statements included in this presentation contain forward-looking information concerning BG Groups strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the…
  3. Q3 2011 Results and Strategy – BG Group – slide 3
    Q3 results Q3 2011 key points Total operating profit up 17% year-on-year to 1.9 billion Cash flow from operations up 59% year-on-year to 2.7 billion Production up 1%, held back by outages at UK facilities which are back onstream…
  4. Q3 2011 Results and Strategy – BG Group – slide 4
    Q3 results Q3 2011 results Q3 2011 Q3 2010 % yoy Total operating profit (m) 1 943 1 667 +17% Earnings (m) 1 021 978 +4% EPS (cents) 30.1 28.9 +4% Cash generated by operations (m) 2 738 1 726 +59% Continuing operations…
  5. Q3 2011 Results and Strategy – BG Group – slide 5
    Q3 results Q3 2011 total operating profit Q3 2011 Q3 2010 % yoy m m E&P 1 183 761 +55% LNG 620 725 -14% T&D 130 197 -34% Other activities 10 (16) - Group total 1 943 1 667 +17% Continuing operations excluding disposals,…
  6. Q3 2011 Results and Strategy – BG Group – slide 6
    Q3 results E&P benchmarking 3 year unit F&D cost (/boe) Annual unit opex cost (/boe) BG 2008-2010 BG 2010 Peer 2010 Peer 2008-2010 0 20 40 60 0 5 10 15 20 Source: Evaluate Energy 2011 BG Group Peer Group includes Super…
  7. Q3 2011 Results and Strategy – BG Group – slide 7
    Outlook LNG BG Group total LNG operating profit ( million) Actual Plan 3000 c. 2.4 bn 1.9 to 2.2 bn 2000 1000 0 2008 2009 2010 2011 2012 Continuing operations excluding disposals, certain re-measurements and…
  8. Q3 2011 Results and Strategy – BG Group – slide 8
    Q3 results Q3 2011 results Q3 2011 Q3 2010 % yoy Cash generated by operations (m) 2 738 1 726 +59% Capex excl acquisitions (m) 2 900 2 079 +39% Net debt (m) 10 845 6 265 Gearing (%) 27% 19% Investment in growth,…
  9. Q3 2011 Results and Strategy – BG Group – slide 9
    Q3 results Capital investment & balance sheet 2011-2012 10 bn in 2011 11 bn in 2012 Brazil, Australia, US and UK focus Soundly financed 7 year average net debt maturity 5.75 bn undrawn committed lines, maturities from 2012 to…
  10. Q3 2011 Results and Strategy – BG Group – slide 10
    Market background
  11. Q3 2011 Results and Strategy – BG Group – slide 11
    Market background World GDP outlook Real GDP growth (annual % change) 12% 2000-08 2010-20 10% 8% 6% 4% 2% 0% US Japan EU China India World Source: Oxford Economics High growth in emerging markets drives…
  12. Q3 2011 Results and Strategy – BG Group – slide 12
    Market background Contribution to world energy demand Country contribution to net global demand increase (% of total) USA 2000-08 2010-20 Japan EU India China -10% 0% 10% 20% 30% 40% 50% 60% Source: Wood…
  13. Q3 2011 Results and Strategy – BG Group – slide 13
    Market background Significant upside for emerging market gas demand Gas consumption vs GDP/head 45% Gas share of energy consumption 40% UK 35% 30% US 25% 20% Japan 15% 2020 India 2010 10% 2000 China 5% 0% 1000…
  14. Q3 2011 Results and Strategy – BG Group – slide 14
    Market background Gas penetration China is a key market Gas < 4% of energy mix in 2009 1% gas increase in China energy mix Around 25 bcma increase in demand Equivalent to 4 QCLNG trains China gas penetration to India levels ca…
  15. Q3 2011 Results and Strategy – BG Group – slide 15
    Markets background Chinese LNG import estimates Chinese LNG demand forecasts & regas capacity (mtpa) 70 60 Sep 2011 Possible 50 40 Nov 2010 Regas Likely capacity 2020 (as of Nov 30 Nov 2009 MOU contracted 2010) Approved volumes…
  16. Q3 2011 Results and Strategy – BG Group – slide 16
    Market background Drivers of gas growth Incremental gas demand (bcma) 1000 Past demand growth Driven by coal substitution in power Mainly in developed economies Mostly oil substitution Future demand growth 500 Driven by oil…
  17. Q3 2011 Results and Strategy – BG Group – slide 17
    Market background Gas demand outlook World gas demand (bcma) 5000 CAGR 2010-2020 4000 China 10.3% Asia (excluding China) 3.4% 3000 Middle East & Africa 5.4% South America 3.8% 2000 Russia and Central Asia 2.0% 1000…
  18. Q3 2011 Results and Strategy – BG Group – slide 18
    Market background Global supply Global gas supply 2010-2020 (bcma) 5000 CAGR 9.0% CAGR 2.9% 4,108 4000 Other LNG 3,087 M East 75% of 3000 C Asia current Russia supply Decline N America 2000 1000 0 2010 2020 Source:…
  19. Q3 2011 Results and Strategy – BG Group – slide 19
    Market background LNG supply & demand (2020) LNG supply & demand in 2020 (mtpa) 500 Unmet 400 demand Supply Forecast 2020 trade* tightness 70 mtpa 300 supply challenge Planned** 200 100 2010 trade 0 Supply Demand…
  20. Q3 2011 Results and Strategy – BG Group – slide 20
    Markets background Japan impact of 2011 earthquake and tsunami Incremental LNG demand (p.a.)* Incremental demand estimates* 14 6-12 mtpa near-term 9-12 mtpa long-term 12 Uncertainties 10 Future role of nuclear Near-term: when…
  21. Q3 2011 Results and Strategy – BG Group – slide 21
    Market background Key messages Strong growth in global demand for energy through decade Low gas share of total energy consumption in emerging economies Both economic development and fuel substitution drive growth Global LNG to…
  22. Q3 2011 Results and Strategy – BG Group – slide 22
    Portfolio for growth
  23. Q3 2011 Results and Strategy – BG Group – slide 23
    Portfolio for growth Clear, effective and resilient strategy Global Gas Major Connect gas to Secure competitively high-value markets priced resources Build & access markets Equity reserves Serve customers Contracted resources…
  24. Q3 2011 Results and Strategy – BG Group – slide 24
    Portfolio for growth Prospect inventory of resources Other Australia Brazil Net risked resources of 3.7 bn boe UK Thailand CAGR 12% 2000-2010 Tanzania Egypt 200 prospects & leads Norway 85% gas related China USA 60% in…
  25. Q3 2011 Results and Strategy – BG Group – slide 25
    2010 results Proved reserves replacement BG Groups reserves replacement 3 year reserves replacement 3 year total 223% proved RRR 1 year total 224% proved RRR BG 2008-2010 (1) BG 2008-2010 (2) Peer 2008-2010 3 year…
  26. Q3 2011 Results and Strategy – BG Group – slide 26
    Portfolio for growth Reserves & resources Total reserves & resources (mmboe) CAGR 19% Total reserves & 18000 resources/ 16,180 production* 14,494 13,126 3,707 69 years 3,433 12000 10,046 3,562 53 years 8,017 4,931 5,757 3,356…
  27. Q3 2011 Results and Strategy – BG Group – slide 27
    Portfolio for growth Key projects 1800 1200 Projects 2011-2013 Projects 2014-2016 Projects 2017-2020 Bolivian projects KGK train 4 Brazil FPSOs Jordbr Block 5c KGK further trains Bongkot South Lula FPSO 2 Bream KGK…
  28. Q3 2011 Results and Strategy – BG Group – slide 28
    Portfolio for growth Australia: Project progress Curtis Island QCLNG plant QCLNG sanctioned October 2010 Two trains: 8.5 mtpa Gladstone BGs 7th & 8th LNG trains in 12 years Existing pipeline Construction underway LNG site…
  29. Q3 2011 Results and Strategy – BG Group – slide 29
    Portfolio for growth Australia: Production and options for expansion BG Group net production* (000s boepd) Net plateau production ca 210 kboepd* 250 Partner/Other gas supplying Expansion potential beyond two trains QCLNG 200…
  30. Q3 2011 Results and Strategy – BG Group – slide 30
    Portfolio for growth US E&P: Haynesville core economics Typical well (bcf/year) Average well recovery: 9 bcf 3 BG net wells: 275 (2011-15) Average well cost 9m (1.0/mmbtu) 2 Operating cost: 1.4/mmbtu Unit technical cost:…
  31. Q3 2011 Results and Strategy – BG Group – slide 31
    Portfolio for growth US E&P: Production Rapidly expanding & capital efficient BG total resources 8.5 tcf Leveraging marketing capabilities Benefit from supply restructuring Highest quality areas in Haynesville Core c.80% of…
  32. Q3 2011 Results and Strategy – BG Group – slide 32
    Portfolio for growth Brazil: Key developments BG Group net Brazil reserves & resource (bn boe) 6 Reserves & resources doubled since 2010 Mean estimate 6 billion boe net 4 Potential of 8 billion boe net 2 Improved reservoir…
  33. Q3 2011 Results and Strategy – BG Group – slide 33
    Portfolio for growth Brazil: Reserves and resources doubled Mean reserves & resources 6 billion boe 95% in Lula, Guar, Cernambi, Iara & Carioca fields Based upon dynamic data showing: SO PAULO Rio de Janeiro Much higher well…
  34. Q3 2011 Results and Strategy – BG Group – slide 34
    Portfolio for growth Brazil: Gross FPSO capacity All FPSOs committed for 2.3 mmboepd capacity by 2017 34
  35. Q3 2011 Results and Strategy – BG Group – slide 35
    Portfolio for growth Brazil: Production BG Group net production (000s boepd) Net production 550 kboepd by 2020* 600 Santos Basin potential upside Earlier FPSO ramp up 450 Higher production rates Extended plateau production…
  36. Q3 2011 Results and Strategy – BG Group – slide 36
    Portfolio for growth E&P: Tanzania and Kenya Excellent position in frontier play ca 28,000 sq km (ca 140 UK blocks) Chewa-1 First 3 wells successful Block 4* Significant gas discoveries Pweza-1 Block 3* Range of play concepts to…
  37. Q3 2011 Results and Strategy – BG Group – slide 37
    Portfolio for growth LNG supply growth options BG Group total LNG contracted volumes (mtpa) 30 ca +50% 20 ca +50% 10 0 2010 2015 2020 QCLNG T3 New supply potential Future volumes at 2011 ref erence conditions (see…
  38. Q3 2011 Results and Strategy – BG Group – slide 38
    Portfolio for growth Long-term production volumes BG Group net production (000s boepd) 1800 1.6 million Risked Exploration boepd 1500 Other 1.2 million 1200 8% boepd 6% 900 US 600 Australia 300 Brazil 0 2010 2010…
  39. Q3 2011 Results and Strategy – BG Group – slide 39
    Q3 results Q3 2011 key points Total operating profit up 17% year-on-year to 1.9 billion Cash flow from operations up 59% year-on-year to 2.7 billion Production up 1%, held back by outages at UK facilities which are back onstream…
  40. Q3 2011 Results and Strategy – BG Group – slide 40
    BG Group: Q3 2011 Results & Strategy October 2011
  41. Q3 2011 Results and Strategy – BG Group – slide 41
    Appendix Key assumptions REFERENCE CONDITIONS Brent Oil price US 70/bbl US Henry Hub 5.5/mmbtu US/UK exchange rates of 1.5:1 US/AUD exchange rates of 1:A1.2 Prepared under International Financial Reporting Standards All production…

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