BG Group has written down the value of its portfolio of assets by US$8.9 billion to reflect the sharp falls in oil and gas prices.
The charges swung the group into a pre-tax loss of US$2.33 billion in 2014.
The bulk of the near US$9 billion impairment charges has been taken against the company’s US$20.4 billion coalbed methane (CBM) project in Queensland, Australia.
BG Group has decided to write down US$2.7 billion of the value of the physical assets of the Curtis Island CBM to LNG project, which loaded its first cargo of LNG in December, following the sale of its QCLNG Pipeline subsidiary to APA Group for US$ 5 billion.
“The sharp deterioration in commodity prices in the second half of the year has led us to recognise significant asset impairment charges in the fourth quarter,” said Andrew Gould, interim executive chairman of the FTSE 100 energy group.
According to the Financial Times, Gould compared the recent meltdown in oil prices to the situation in 1986, when large additions to world oil supply led to protracted decline in the cost of crude.
Edited from various sources by Sam Dodson
Read the article online at: https://www.worldcoal.com/cbm/03022015/bg-group-writes-down-value-of-assets-by-almost-9-billion-dollars-cbm199/