LNG work in Egypt uncertain for BG Group

LONDON, July 31 (UPI) -- Only one cargo of liquefied natural gas left Egypt during the second quarter and the outlook for the rest of the year is grim, BG Group said Thursday.

The company reported an 11 percent increase in operations profits for the second quarter to nearly $2 billion. It attributed the financial success to increased output and higher prices from its Asian and South American operations.

"We have delivered a good set of results for the second quarter," interim Executive Chairman Andrew Gould said in a statement.

The company said it expected lower output from exploration and production and few cargoes of liquefied natural gas in the second half of the year.

In Egypt, which accounted for about 10 percent of its LNG business during the second quarter and 6 percent of its earnings, BG group said production of 57,000 barrels of oil equivalent during the second quarter was 52 percent lower year-on-year.

Only one cargo of LNG was taken from Egypt by BG for the second quarter. With declining upstream production, the company said it expects LNG operations in the country will be limited going forward.

BG in January said the Egyptian government wasn't honoring agreements regarding its share of natural gas from Egyptian fields, saying diversions into the domestic market were higher than expected.

"In the absence of concerted action from the Egyptian government, the future commercial operation of Egyptian LNG remains at risk," the company said.