8.5 C
New York
November 21, 2024
1st Afrika
STOCK MARKET

BG Group Mulls US$4bn sale of Tanzania LNG Stake

oil & Gas

Deutsche Bank reckons the Tanzanian stake could fetch in the order of US$4bn (or 50p per share) for BG – on the basis that partner Ophir sold 20% for US$1.3bn last year.

BG Group (LON:BG.) is reportedly mulling the sale of its stake in a large liquefied natural gas project offshore Tanzania.

The ‘super-major’ has a 60% interest in the series of massive gas discoveries in East Africa, according to a report in the Sunday Times.

Deutsche Bank reckons the Tanzanian stake could fetch in the order of US$4bn (or 50p per share) for BG – on the basis that partner Ophir sold 20% for US$1.3bn last year.

“The sale of at least part of its interest in Tanzania would prove a useful exercise in exploration monetization as well as reducing the company’s exposure to forward development risk,”

“In particular, the capex obviation associated with any such sale should add greater credence to BG’s forward guidance that capex will decline to $8-10bn from 2015 from a run rate of c$12bn in recent years – adding confidence in forward free cash flow growth.”

Separately, the analyst at the German bank highlighted progress with BG’s 25% owned major Brazilian development where a fourth floating production vessel is being mobilised and is due to come online in the fourth quarter.

“We expect that the addition of this facility combined with the hook up of additional wells at the existing sites will see continued healthy momentum in BG’s Brazilian production over the coming quarters.”

 

Related posts

 African Stock Exchanges See Mixed Performance as Global Economic Conditions Shift

Eniola Oladele

Rand Extends Gains As Global Mood Perks Up

Jide Adesina

Riding the Market Waves: Key Trends Shaping Africa’s Stock Exchanges Today

Eniola Oladele

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More