BG GROUP is doubling the final payout to its investors after a cash windfall in the fourth quarter as the group sold more oil and gas at higher prices.
The gas exploration and production group trumped larger rivals by raising its hydrocarbon output by a fifth in the final quarter. The growth in volume, mainly from the start-up of liquefied natural gas production in Egypt, combined with higher gas prices, helped more than double BG’s net profit for the quarter to £504 million. For the year as a whole, net profit rose 57 per cent to £2.4 billion.
BG responded yesterday to critics who reproached the company for hanging on to its cash. The final dividend is increased from 2.08p to 4.09p, making a total of 6p for the year, an increase of 57 per cent on the payout in 2004
BG stock celebrated news of the increased dividend, gaining 9 per cent, and the market welcomed forecasts of further growth in oil and gas volumes.
Rival firms have struggled to raise output and to replace their reserves but BG yesterday said that it had added 1.2 barrels for each barrel of oil and gas produced last year. Frank Chapman, BG’s chief executive, said that he expected average volume increases of between 6 per cent and 10 per cent a year until 2012.