BG Group said yesterday it was targeting 1.4million barrels of oil equivalent per day (boepd) globally by 2020 and the North Sea would help boost output in the short term.
The UK-based oil and gas firm posted a 19% surge in annual operating profits, to £5.18billion, helped by strong oil and liquefied natural gas (LNG) prices.
BG predicted profits from its LNG supply business would rise 30% in 2012, to at least £1.64billion. It also announced a successful appraisal well on its central North Sea Jackdaw discovery, which straddles several blocks in which BG has large stakes.
Total production in 2011 was down 1%, however, because of “a series of outages and third-party infrastructure restrictions in the UK North Sea”. Elsewhere, production rose 5%.
Chief executive Sir Frank Chapman said BG was starting 2012 with a production run rate of some 650,000boepd and would end the year at about 750,000. He added: “Key factors will be improved production from the UK, alongside six new projects coming on stream.”
These would be in Bolivia, Egypt, Norway, Thailand and the Jasmine field in the UK.
BG said issues in the North Sea hit production by 24% during 2011, cutting 12million barrels from the planned total.
The problems were described as a series of elective shutdowns, third party-operated infrastructure restrictions, plant commissioning activities and extreme weather.
BG said it was targeting 50million boe in the North Sea in 2013-14. Its 2020 production predications are based on significant growth in Australia and Brazil, where BG said it expected to be producing some 600,000boepd.
Sir Frank said successful exploration and appraisal activity in 2011, including finds in Norway and Tanzania plus Esperanza in the UK, meant the firm’s reserves and resources now stood at 17.1billion boe, or 73 years of production at 2011 levels.
It aims to spend nearly £950million on exploration in seven countries this year, including new frontier plays in Australia, Egypt and Tanzania.