BG Group profits fall due to lower gas and oil prices

BG Group hope to produce 1.6 million barrels of oil per day in 2020

BG Group said its pre-tax profits fell to £857m ($1.4bn) in the three months to the end of December 2009 from £1.3bn in the same period a year ago.

Full year profits for the UK gas producer were down to £3.9bn in 2009, from £5.5bn in 2008, impacted by lower gas and oil prices, the company said.

Gas production rose 8% in the fourth quarter compared with the same period in 2008, and was lower than expected.

BG Group shares were down 3.1% in early trading.

Chief executive Frank Chapman said BG would be producing 1.6 million barrels of oil equivalent per day in 2020, compared with 673,000 produced per day in the fourth quarter.

However, low demand for gas due to the weak global economy would mean only slight output growth this year, BG said.