BG Group CEO resigns as firm cuts production forecasts

BG Group chief executive officer Chris Finlayson has resigned, as the UK's third-largest oil and gas producer ditched an output forecast made just three months ago. Mr Finlayson (58), leaves with immediate effect for personal reasons, and will be replaced on a temporary basis by chairman Andrew Gould until a permanent successor can be found, the company said in a statement today. He had been in the job for little over a year.

BG said today oil and gas production this year would be at the lower end of the estimated range because of declining production in Egypt. The company is reviewing operational, investment and portfolio management plans and won’t provide 2015 guidance until February, it said, abandoning a production forecast Mr Finlayson made in January.

“The board felt that it was in the best interests of the group to accept Chris’s resignation and seek fresh leadership,” said Mr Gould, who becomes interim executive chairman.

BG shares dropped 64.5 pence, or 5.6 per cent, to 1,080.5 pence in London trading at 8:17 a.m. local time, the biggest intraday decline since January.

Mr Finlayson, a former Royal Dutch Shell Plc executive who joined BG in 2010 before taking over from long-term chief executive Frank Chapman at the start of last year, was forced to issue a profit warning in January because of delays at projects in Australia, Brazil and the North Sea and political turmoil in Egypt. The shares dropped 14 per cent the same day.

BG, which was formed in 1997 when former state gas monopoly British Gas Plc split its exploration and production arm from its retail business, is the biggest UK-listed gas producer after Royal Dutch Shell and BP.

Mr Finlayson’s predecessor Mr Chapman was chief executive from 2000 to 2012.

Bloomberg