Egypt Not Only Thorn in BG's Side — So, Too, US Shale

摘要

The full-year 2013 earnings reporting season formally kicks off for the Western majors Wednesday, but profit warnings from European leaders Royal Dutch Shell and BG have already muddied the waters. Shell's London-listed shares are down a modest 1.7% this year as investors cut new Chief Executive Ben van Beurden some slack in his first days on the job (EIF Jan.22'14). BG, however, has undergone its second massive earnings-related bloodletting in 15 months, with its London shares down nearly 19% as investors grow tired of guidance cuts that began in the final weeks of former Chief Executive Frank Chapman's tenure and have become a routine fixture under current Chief Executive Chris Finlayson (EIF Dec. 19'12). BG's Egyptian woes have become a persistent thorn in the side of the UK gas giant — and fall outside the company's control (EIF Oct.30' 13). But operating struggles elsewhere and a lackluster US natural gas environment are also to blame, leaving BG's once gold-plated growth trajectory an increasingly distant past accomplishment, and its market cap some $13 billion-equivalent lower than it was just last week.