BG Says Qatar to Start LNG Gas Supplies in July to Counter Egypt

BG Group Plc (BG/), the U.K.’s third-largest natural-gas producer, said Qatar will begin liquefied natural gas supplies at the end of July to counter lost volumes from Egypt after diversion of the fuel to the domestic market.

BG will get two of five Qatari LNG cargoes between July and mid-September after the shipping schedule was completed, it said today in a statement. Local deliveries from BG’s West Delta Deep Marine rose 29 percent to an average 900 million cubic feet a day in the second quarter, from the prior three months, “close to the sustainable maximum domestic” diversion capacity.

“The Egyptian authorities provided written notice that domestic volumes will continue at the current level until the end of September,” said Reading, England-based BG. Egyptian operations “have not been affected by the civil unrest and change in government,” and at the same time the “investment programme is under continuous review.”

Egyptian LNG, where Petroliam Nasional Bhd. and GDF Suez (GSZ) SA are partners, is operating at reduced levels, BG said. The U.K. company’s receivables from Egypt General Petroleum Corp. for domestic gas sales rose $100 million to $1.3 billion by June 30.

“The recovery of receivables and the full realization of the carrying value of the Group’s Egyptian operations remain dependent on the business environment in Egypt,” BG said.

Egypt accounted for about 20 percent of BG’s production and 15 percent of earnings last year.

Source: Bloomberg