London, 28 July (Argus) — UK-listed BG Group's second-quarter crude and condensates production fell by 8.6pc against a year earlier, with crude output down more than 11pc at 78,000 b/d and condensates output almost 6.5pc lower at 97,000 b/d. Natural gas, which currently makes up most of the company's production, was slightly up at 455,000 b/d of oil equivalent (boe/d).

Production levels of crude, condensates and gas were all lower than in the first quarter but BG said it still envisaged full-year output being higher than for 2009. The overall decline in second-quarter production of around 2pc was because of the extent and phasing of planned maintenance, it said.

The company will begin to benefit before the end of the year from its stake in the Tupi oil field in the Santos basin, offshore Brazil. Initial production from a permanent facility remains on track to commence at 100,000 b/d after a period of long-term testing. The company has yet to issue updated reserve estimates for its Brazilian acreage but has said in the past that by 2020 it expects the assets to be contributing 400,000 boe/d.

Earnings for the exploration and production division of BG for the quarter tumbled 33pc to $499mn, but the company said that the underlying performance of the division improved by 2.5pc to $746mn once disposals and impairment charges were stripped out. The exceptional charges of $247mn for the division for the period included an impairment charge of $191mn against assets.

Profit for the quarter fell almost 21pc against a year earlier to $638mn at the company level, better than market expectations. But BG shares were almost 1pc lower in early London trading.

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