1st Quarter Results

First Quarter Key Points

·; Total operating profit up 21% to $2.4 billion

·; Cash generated by operations up 47% to $2.6 billion

·; LNG operating profit up 42% to $812 million

·; E&P production up 5% to 60.9 mmboe

·; New projects onstream in Norway, Thailand, Bolivia and Egypt

·; Fourth gas discovery in Tanzania, mean total gross recoverable resources approaching 7 tcf

·; Execution of funding plan on track, with disposals and new funding agreements announced

a) 'Business Performance' excludes disposals, certain re-measurements and impairments as exclusion of these items provides a clear and consistent presentation of the underlying operating performance of the Group's ongoing business. During the first quarter, total results included a post-tax charge of $44 million (2011 $223 million charge) in respect of disposals, re-measurements and impairments. This included a post-tax charge of $36 million (2011 $281 million charge) in relation tomark-to-market movements on long-term commodity contracts and economic hedges. For further information see Presentation of Non-GAAP measures (page 11) and notes 1 to 3 (pages 18 to 20). Unless otherwise stated, the results discussed in this release relate to BG Group's Business Performance.

b) Includes a charge in respect of prior period taxation (Business Performance $195 million, Total Results $148 million) arising on the revision of deferred tax balances at1 January 2011 due to changes in UK taxation rates.

BG Group's Chief Executive, Sir Frank Chapman said:

"BG Group has posted a strong set of first quarter results with total operating profit up 21% to$2.4 billion, earnings up 55% to $1.3 billion and cash generated by operations up 47% to$2.6 billion."

"Our exploration and production business delivered a 5% increase in volumes and total operating profit for our LNG business was up 42% to $812 million, boosted by continuing strong demand from Asian markets."

"This year we have brought key new developments into production, continued to make material progress across our major projects, and we announced further exploration success."

Sir Frank added, "four of our 2012 projects were successfully brought onstream and began production build-up."

"In Egypt, phase seven of the West Delta Deep Marine development was brought online; offshore Norway, we achieved first production from the Gaupe field; in Thailand, new facilities at Greater Bongkot South began delivering volumes; and, in Bolivia, the first phase of production from the Margarita field commenced."

"These new sources of production will, at plateau, add around 50 000 barrels of oil equivalent per day net to the Group's production; helping to keep us on track to deliver our 6% to 8% annual average growth rate through to 2020."

On BG Group's major projects Sir Frank said, "we're making rapid progress in Brazil with the development of the 'big five' Santos Basin discoveries. A fourth producing well has been connected to FPSO1 and the construction and conversion programmes for the further 12 FPSOs continue to advance providing tangible progress towards 2.3 mmboe per day of installed capacity by 2017."

"In Australia, we have increased drilling capacity as planned and delivered over 70 wells in the quarter; 31 in the month of March. Significant upstream contract awards for facilities and infrastructure are progressing. At the LNG plant on Curtis Island, dredging continues to progress to schedule; construction of the two LNG storage tanks is ongoing; and the first of 47 modules from Thailand is due for delivery in the second half of 2012. Despite cost pressures, the project remains firmly on track for first LNG in 2014."

Sir Frank continued, "in addition to project delivery, the Group continued to enjoy exploration and appraisal success, maintaining our position as one of the industry's leading explorers."

"In Tanzania, a fourth consecutive success in this emerging new province raised the estimated gross mean recoverable resources to approaching some 7 trillion cubic feet of gas. Offshore Brazil, a new appraisal well confirmed the westerly extension of the Iara accumulation in the BM-S-11 concession, underlining the potential of the Group's interests in the world-class pre-salt Santos Basin."

Commenting on the Group's funding programme, Sir Frank highlighted that, "since the start of the year, BG Group has met important milestones, executing a Memorandum of Understanding to sell our stake in Comgás and reaching an agreement for the sale of the Quintero regasification terminal in Chile; we are also moving further ahead with our plans to divest our interests ingas-fired power generation plants in the Philippines. The execution of our funding plan was complemented by an agreement with Export Development Canada for a credit facility of$500 million and, also, by the acceptance from the Brazilian Federal Development Bank ofBG Group's eligibility for up to $1.8 billion in long-term financing for its projects in Brazil."

Sir Frank also remarked upon the Elgin incident in the UK North Sea, in which BG Group holds a 14.11% interest, "we continue to work closely with the operator, Total, to ensure the issue is resolved in a safe and timely manner."

In conclusion, Sir Frank said, "BG Group has delivered significantly stronger financial results in the first quarter and with new production coming onstream, further progress on our major projects, and continued exploration success, we remain firmly on track to achieve our long-term objectives."

Business Review - Group

a) For a definition of capital investment on a cash basis see Glossary (page 31). For a reconciliation between capital investment on a cash basis and total capital investment see Supplementary Information (page 26).

b) Includes a charge of $195 million in respect of prior period taxation arising on the revision of deferred tax balances at 1 January 2011 due to changes in UK taxation rates.

First quarter

Revenue and other operating income increased by 20% to $5 776 million, reflecting the benefit of higher realised prices, continued strong demand for the Group's LNG cargoes, particularly from Asia, and a 5% increase in E&P production volumes.

Total operating profit in the quarter increased by 21% to $2 373 million as a result of the increase in revenue and other operating income and a lower exploration charge.

Cash generated by operations increased by 47% to $2 645 million, primarily as a result of higher profits and a lower working capital cash outflow.

The Group's effective tax rate (including BG Group's share of joint venture and associates' tax) was 45% for the quarter, in line with the underlying rate for 2011 excluding the $195 million charge in respect of prior period taxation.

As at 31 March 2012, the Group's net debt was $11 551 million. The average maturity of the Group's gross borrowings remained at around 10 years and the gearing ratio, at 26.6%, was slightly lower than at the end of the fourth quarter 2011. During the quarter, BG Group received initial approval from the Brazilian Federal Development Bank (BNDES) for up to $1.8 billion of long-term finance to fund part of the company's interests in the pre-salt Santos Basin, offshore Brazil. In April, BG Group signed a $500 million credit agreement with Export Development Canada. These agreements further diversify BG Group's long-term international funding sources and help underpin the delivery of the Group's global growth programme.

Net finance costs of $41 million included $21 million of interest received on tax refunds and foreign exchange losses of$9 million (2011 net finance costs of $79 million including foreign exchange losses of $22 million).

Organic capital investment on a cash basis of $2 505 million in the quarter comprised investment in E&P($1 806 million), LNG ($613 million) and T&D ($86 million). This investment focused primarily on the Group's major projects in Australia, Brazil and the UK, and represented a 20% increase in organic capital investment compared with the first quarter 2011, in line with our business plan. Further details on project developments are provided in the first quarter business highlights section.Industry Trends

Despite the uneven nature of the global recovery, global energy prices remain relatively robust. Brent crude oil averaged $118 per barrel in the first quarter, elevated at least partly by rising geopolitical tensions around Iran. Lower crude inventories globally, outside of the USA, and the perceived limited spare capacity of the major players are also contributing, together with outages in a number of producers including Nigeria and Sudan. West Texas Intermediate (WTI) remains at a discount relative to Brent, averaging $101 per barrel; the differential is largely driven by historically high levels of crude inventories at Cushing, the delivery point for WTI-marker crude.

Henry Hub prices, in marked contrast to other energy prices, remain at relatively low levels, averaging $2.74 per million British thermal units (mmbtu) in the first quarter, compared to $4.11 and $3.55 per mmbtu in the first and fourth quarters of 2011, respectively. Although demand has improved, recording an additional 1.7 billion cubic feet per day (bcfd) in 2011 compared with 2010, production has increased much faster (4.6 bcfd), even though companies are reducing rig counts. As of 16 April 2012, gas-directed horizontal rigs numbered 425, a reduction of over 27% (160 rigs) from the beginning of the year. This reduction was not able to offset the rise in gas associated with liquids production and the effects of a warmer than normal winter, both of which have led to record high inventory levels (2 482 bcf in storage at the end of the first quarter, 57% higher than last year). In April, prices averaged $1.94 per mmbtu.

In terms of global LNG markets, January saw record high flows from the Atlantic Basin to Pacific Basin markets as demand in Asia continued to pull increasing volumes into the region and away from Europe. LNG supply levels in January were approximately 264 million tonnes per annum (mtpa). However, supply growth is slowing, with no new trains due to come online until Pluto LNG Train 1 (T1) and Angola LNG T1 in the second quarter.

On the demand side, Japanese LNG imports reached record levels reflecting the effects of further nuclear units going offline, winter weather and stronger economic performance. As a result, Asian spot LNG prices were significantly higher, averaging some $16.00 per mmbtu in the first quarter versus $9.93 per mmbtu in the first quarter of 2011. Prices have however fallen somewhat from their recent peaks in the $17 to $18 per mmbtu range, but are expected to stay near current levels if nuclear capacity remains offline for the foreseeable future.

UK imports continued to hold at approximately 12 mtpa, with National Balancing Point (NBP) prices averaging$9.35 per mmbtu in the first quarter, above the $9.06 and $8.94 per mmbtu averages in the first and fourth quarters of 2011, respectively.

First quarter business highlights

Australia

The Queensland Curtis LNG (QCLNG) project progressed well as some $1.1 billion was invested during the first quarter in the parallel projects of upstream development of gas and water treatment facilities, the 540 kilometre pipeline network, and the first phase two-train LNG plant.

In the upstream, three further petroleum leases were granted in the quarter taking the total number of leases held to22 in the core Surat Basin acreage. The remaining seven petroleum leases required for first LNG in 2014 are expected to be granted during the remainder of 2012, in line with BG Group's plan.

Over 70 wells were delivered in the quarter (31 in March), as drilling capacity increased in line with plans. Drilling activities will continue to ramp up as the rig count increases from the current six to 11 rigs in the second half of the year. Some 800 wells have been drilled to date.

The first water treatment plant, at Windibri, was commissioned and treated water is being provided to the Condamine power station. The Windibri plant has a capacity of some six million litres per day.

Field compressor station (FCS) construction activities progressed at Argyle and Bellevue and a significant contract was awarded for six further FCSs and one central processing plant (CPP). Further, the award of an additional 13 FCSs and 3 CPPs is currently being evaluated.

All of the 42" gas collection header, totalling almost 200 kilometres, has now been strung out along the pipeline route, welding is advancing and pipeline trenching and laying has commenced. Way-leave clearance continued for the340 kilometre main trunkline to Curtis Island.

Construction of the LNG plant is moving ahead well, with work continuing in both Thailand and on Curtis Island.

In Thailand, construction of 47 modules progressed well with piping, mechanical and cable ladder construction underway. The first module is on schedule for delivery in the second half of 2012. On Curtis Island, notable achievements included completion of dredging in and around the jetty berth, delivery of the first shipment of the LNG tank roof plates and completion of pile driving on the heavy lift dock. The first quarter also saw ongoing construction of the two LNG storage tanks and the completion of the QCLNG site offices on Curtis Island and subsequent construction team relocation.

QCLNG is therefore making good progress towards first LNG in 2014, in a busy Australian construction environment. Increasing costs for local goods and services, although mitigated through early implementation and contracting strategies, are clearly evident from ongoing upstream tendering. BG Group now estimates that the QCLNG sanctioned investment of $15 billion1 will increase by 19% due to local market effects, increased costs of compliance with regulatory processes and some scope change. This underlying cost increase, combined with the 20% appreciation of the Australian dollar, yields a revised QCLNG investment of $20.4 billion2 and an upstream unit capex of $9 per boe3.

Bolivia

In May, BG Group announced the start-up of production from Margarita Phase I. This development phase represents a key milestone in the continued development of the Caipipendi block. Margarita is expected to produce some40 000 barrels of oil equivalent per day (boed) net to BG Group by the end of 2014, following completion of the Phase II project sanctioned in July 2011.

Brazil

In Brazil, all aspects of developing the 'big five' Santos Basin fields are progressing according to plans.

This progress, as well as strategic objectives and future outlook, was presented during a February analyst/investor visit to Rio de Janeiro hosted by BG Group. The visit also included third-party supplier site visits and presentations from partners. Key messages included: the stable business environment in Brazil; fast track developments with production already underway; field development plans in place, with substantial opportunities for enhancement as experience is gained; improved drilling performance and significant economies of scale; gas evacuation optimisation to enhance oil recovery; local content requirements being exceeded with quality and depth from local suppliers; very strong partner alignment; and BNDES support for BG Group's Santos Basin investments.

1. 2011 to 2014 capex at the 2011 BG Group reference exchange rate of US$1:A$1.2 as announced on 8 February 2011.

2. At the 2012 BG Group reference exchange rate of US$1:A$1.

3. Reference $8 per boe presented in QCLNG economics summary in 9 February 2012 Strategy Presentation.

First quarter business highlights (continued)

Brazil (continued)

Strong progress continues with the floating production, storage and offloading vessels (FPSOs). A fourth producing well has been connected to FPSO1. FPSOs 2 to 5 are on schedule with the latest FPSOs exhibiting lower unit costs than previous vessels. FPSO 2 is now over 85% complete, in line with plans and expected to start up in the first half of 2013. The hull conversion for FPSO 3 has been completed in Singapore; this vessel is now 75% complete and is due to sail to Brazil for integration of topsides in the second quarter, in line with plans to bring the unit onstream in 2013. Hull conversion is ongoing in China for FPSOs 4 and 5, which are both around 15% complete, and integration activities will take place in Brazil ahead of planned start-up in 2014. The fabrication of hulls for FPSOs 6 to 13 continues in the Rio Grande de Sul shipyard in Brazil.

In March, BG Group announced the start of a new extended well test (EWT) in the Iracema area of the BM-S-11(BG Group 25%) concession. The EWT is expected to span approximately a six month period, gathering technical information on reservoir behaviour and production performance. The well has been producing around12 000 barrels of oil per day (bopd), constrained by facilities. The information gathered will support the development of the permanent 150 000 bopd capacity FPSO Cidade de Mangaratiba, planned to be in operation in 2014.

In April, BG Group announced the completion of drilling at the Iara West appraisal well in the BM-S-11 concession. Good quality oil samples were encountered and the results confirmed the westerly extension of the Iara accumulation in the pre-salt Santos Basin and demonstrate the high potential of the reservoirs within that area. Iara West is the third well drilled in the Iara area and is part of the fast-track programme to develop the Santos Basin discoveries. BG Group and its partners will continue to appraise the area, including production tests to evaluate reservoir performance.

Norway

In April, BG Group announced the start-up of production from the Gaupe field (BG Group 60% and operator) located in the Norwegian North Sea. Gaupe marks BG Group's first production from the Norwegian Continental Shelf and the project has been delivered on budget and just four years after the declaration of commerciality. The Gaupe field is a cross-border sub-sea tie-back to the BG Group-operated Armada infrastructure located in the UK central North Sea. Production from Gaupe is expected to reach a plateau rate of around 15 000 boed gross during the third quarter of 2012.

Tanzania

In March, BG Group announced its fourth Tanzanian gas discovery with the Jodari-1 (BG Group 60% and operator) exploration well located in Block 1, 39 kilometres offshore southern Tanzania. Preliminary evaluation of the well results indicates gross recoverable resources are in the range of 2.5 to 4.4 trillion cubic feet (tcf) of gas. This is the fourth consecutive successful well drilled in Tanzania, resulting in mean total gross recoverable resources estimated to be approaching some 7 tcf of gas. The Jodari-1 well is the first of a three-to-four well exploration programme, which also includes the acquisition of 2 500 square kilometres of 3D seismic data in Block 1. The next target, currently drilling, is the Mzia-1 location in Block 1, 23 kilometres to the north of Jodari-1.

Thailand

In April, BG Group announced the start of production from the Greater Bongkot South field (BG Group 22.22%) in the Gulf of Thailand, 70 kilometres south of the existing Bongkot North development. Greater Bongkot South has new standalone facilities with processing capacity of 350 million cubic feet of gas and 15 000 barrels of condensate per day. Once plateau production is achieved, Greater Bongkot South will deliver some 14 000 boed net to BG Group. Production is expected to reach plateau in the second quarter of 2012. This development represents a key milestone in the continued development of the Greater Bongkot area.

UK 

On 25 March, production at Elgin/Franklin (BG Group 14.11%, non-operated) was shut-in due to a well control issue on the Elgin platform. BG Group production up to 25 March had reached 1.3 mmboe. In the Group's business plan for 2012, the total expected production was 6.4 mmboe.

In April, the operator of the Jasmine field (BG Group 30.5%, non-operated) advised that production start-up is not now expected until 2013.

Uruguay

In April, BG Group successfully bid for three offshore blocks (8, 9 and 13) in the licensing round held by the Republic of Uruguay. The bid commits BG Group to a seismic work programme of 13 000 square kilometres intended to evaluate the awarded blocks in the first three year exploration phase.

First quarter business highlights (continued)

USA

In April, a proposal for a LNG liquefaction project at Lake Charles in Louisiana was filed with the Federal Energy Regulatory Commission (FERC). The project is at a design and permitting stage and is planned to export up to15 million tonnes per annum (mtpa) of LNG. BG Group has previously received US Department of Energy (DOE) authorisation for LNG export from the Lake Charles terminal to countries with which the USA has a free trade agreement (FTA). BG Group is also awaiting authorisation from the DOE on an application for LNG export from Lake Charles to non-FTA countries.

In April, FERC granted the operator approval to construct and operate facilities for the liquefaction and export of LNG from the Sabine Pass liquefaction terminal in the USA. Significantly, the Sabine Pass terminal, from which BG Group has an agreement to purchase 5.5 mtpa of LNG, now has the key approvals required from the DOE and FERC which will allow the project to proceed. LNG exports from the Sabine Pass facility are expected to commence in 2015.

As planned, given the weak pricing environment in the USA, the Group continues to reduce its rig count and had11 rigs in operation as at the end of April.

Capital expenditure and funding plan

Following the update on costs for the QCLNG project (page 5) and refinements to the Group's portfolio rationalisation programme, BG Group now expects its capital expenditure to increase from $10.6 billion to $11.5 billion in 2012, and from $11.4 billion to $12.0 billion in 2013 on a cash basis. In aggregate, this equates to a 7% increase in the Group's capital expenditure programme for the 2012 to 2013 period.

During the first few months of 2012, BG Group made significant progress in the execution of its funding plan. In May, and as part of its portfolio rationalisation programme, BG Group signed a Memorandum of Understanding withCosan S.A. Indústria e Comércio for the sale of BG Group's 60.1% interest in Comgás, Brazil's largest gas distribution company, for Brazilian Reais 3.4 billion (some $1.8 billion at the current exchange rate). In addition, net borrowings attributable to Comgás as at 31 March 2012 were $1.1 billion; this transaction therefore would lead to some $2.9 billion reduction in the Group's net debt.

In April, BG Group announced that subject to certain consents and regulatory approvals, it had entered into an agreement to sell the Group's 40% share in GNL Quintero S.A. (GNLQ) for up to $352 million.

In May, BG Group sold its entire shareholding of 73.9 million shares (8%) in Senex Energy Limited in Australia for a total of A$75 million ($78 million).

BG Group has also further advanced negotiations on the sale of the Group's interests in two gas-fired power generation plants in the Philippines, Santa Rita and San Lorenzo, with expected completion in 2012.

In March, BG Group announced it had received initial approval from BNDES for up to $1.8 billion of long-term finance to fund part of the Group's interests in the pre-salt Santos Basin, offshore Brazil. The funding will be allocated toBG Group's share of local procurement and construction costs for the eight FPSOs that will be owned by BG Group and its partners, as part of the wider first phase Santos Basin development programme that is expected to deliver2.3 mmboe capacity by 2017.

In April, BG Group announced that it had signed a $500 million credit agreement with Export Development Canada. These agreements are in line with the Group's objective of further diversifying BG Group's international funding sources and help underpin the delivery of the Group's global growth programme.

The progress made so far in the implementation of the Group's funding plan is consistent with the target to release around $5 billion in 2012 and 2013 and the objective to achieve further diversification of long-term funding options.

Exploration and Production (E&P)

Additional operating and financial data is given on page 26.

First quarter

Revenue and other operating income increased by 13% to $2 826 million, reflecting higher realised prices and a 5% increase in production volumes. Total operating profit was 15% higher as a result of the increase in revenue and other operating income combined with a lower exploration charge.

Production volumes in the quarter increased by 5% primarily as a result of the continued ramp up of production in the Group's growth Assets, including Brazil and Australia.

The Group's average realised gas price per produced therm increased by 4% to 41.15 cents; International gas price realisations were 5% higher at 37.79 cents per produced therm reflecting gas prices linked to higher oil market prices, and the average UK realised gas price was 10% higher at 46.59 pence per produced therm primarily as a result of higher contract prices.

The exploration charge of $112 million was $72 million lower primarily as a result of lower well write-off costs. Gross exploration expenditure of $312 million included spend in Tanzania ($97 million), Brazil ($74 million), Australia($40 million) and the UK ($35 million).

Unit operating expenditure increased to $9.54 per barrel of oil equivalent, principally reflecting changes in the production mix, higher commodity prices and higher maintenance costs.

Capital investment on a cash basis of $1 806 million in the quarter included investment in Australia ($491 million),Brazil ($313 million), the UK ($298 million), the USA ($218 million) and Egypt ($173 million).

Liquefied Natural Gas (LNG)

Additional operating and financial data is given on page 26.

First quarter

LNG total operating profit for the quarter of $812 million was 42% higher than last year as a result of favourable market conditions, with continuing strong demand for cargo deliveries outside of the USA, particularly from Asia. During the quarter, BG Group delivered 91% of cargoes (2011 84%) to global markets outside the USA including 34 to Asia, 12 to South America and two to Europe (2011 21 Asia, 10 South America and 11 Europe). Deliveries to Japan increased from four to 16, reflecting record demand as a result of the combined effects of further nuclear units going offline and stronger economic performance. As a consequence of these additional deliveries to Japan, fewer cargoes were delivered to Europe.

BG Group's share of total operating profit from liquefaction activities increased by 7% to $93 million.

These results are in line with the expected seasonal phasing underpinning the Group's full year guidance for 2012 of between $2.6 and $2.8 billion.

Capital investment on a cash basis of $613 million in the quarter was primarily associated with the development of the QCLNG project.

Transmission and Distribution (T&D)

Additional operating and financial data is given on page 26.

First quarter

Revenue and other operating income increased by 15% to $903 million, principally due to higher prices and volumes at Comgás in Brazil and higher prices at Gujarat Gas in India.

T&D total operating profit decreased by 19% to $118 million. Total operating profit at Comgás of $75 million was 6% lower as a result of the timing effect of gas cost recovery.

Excluding this timing effect, total operating profit at Comgás increased by 8% primarily as a result of higher margins and increased volumes. In the quarter, $34 million was passed back to customers compared with $21 million passed back to customers in 2011. At the end of the quarter, the cost of gas to be recovered in future periods was $111 million.

The $22 million reduction in Other T&D activities' operating profit included the impact of adverse foreign exchange movements and higher gas costs at Gujarat Gas.

Capital investment on a cash basis of $86 million mainly represents the development of the Comgás pipeline network.

Presentation of Non-GAAP measures

Legal Notice

Consolidated Income Statement

First Quarter

a) See Presentation of Non-GAAP measures (page 11) for an explanation of results excluding disposals, certain re-measurements and impairments and presentation of the results of joint ventures and associates.

b) Operating profit/(loss) is before share of results from joint ventures and associates.

c) Includes earnings from continuing operations of $1 219 million (2011 $595 million) and from discontinued operations of $2 million (2011 $2 million).

d) This measurement is shown by BG Group as it is used as a means of measuring the underlying performance of the business.

The notes on pages 18 to 25 form an integral part of these condensed financial statements.

Consolidated Statement of Comprehensive Income

a) Income tax relating to hedge adjustments is a $57 million charge for the quarter (2011 $113 million credit).

b) Income tax relating to fair value movements on 'available-for-sale' assets is a $20 million charge for the quarter (2011 $1 million credit).

The notes on pages 18 to 25 form an integral part of these condensed financial statements.

Consolidated Balance Sheet

The notes on pages 18 to 25 form an integral part of these condensed financial statements.

Consolidated Statement of Changes in Equity

The notes on pages 18 to 25 form an integral part of these condensed financial statements.

Consolidated Cash Flow Statement

a) Includes profit before tax from discontinued operations for the quarter of $3 million (2011 $3 million).

b) Includes capitalised interest for the quarter of $99 million (2011 $29 million).

c) Cash and cash equivalents comprise cash and short-term liquid investments that are readily convertible to cash.

d) The balance at 31 March 2012 includes cash and cash equivalents of $3 496 million (31 December 2011 $3 601 million; 31 March 2011 $1 142 million) and cash included within assets held for sale of $nil (31 December 2011 $nil; 31 March 2011 $17 million).

The notes on pages 18 to 25 form an integral part of these condensed financial statements.

Notes

1. Basis of preparation

These primary statements are the condensed financial statements ('the financial statements') of BG Group plc for the quarter ended 31 March 2012. The financial statements do not comprise statutory accounts within the meaning of Section 434 of the Companies Act 2006, and should be read in conjunction with the Annual Report and Accounts for the year ended 31 December 2011 which have been prepared in accordance with IFRS as adopted by the EU, as they provide an update of previously reported information. The latest statutory accounts delivered to the registrar were for the year ended 31 December 2011 which were audited by BG Group's statutory auditors PricewaterhouseCoopers LLP and on which the Auditors' Report was unqualified and did not contain statements under Sections 498(2) or 498(3) of the Companies Act 2006. These financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the EU and the accounting policies, methods of computation and presentation as set out in the 2011 Annual Report and Accounts.

The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amount of revenues, expenses, assets and liabilities at the date of the financial statements. If in the future such estimates and assumptions, which are based on management's best judgement at the date of the financial statements, deviate from the actual circumstances, the original estimates and assumptions will be modified as appropriate in the year in which the circumstances change.

Presentation of results

The presentation of BG Group's results separately identifies the effect of:

·; The re-measurement of certain financial instruments; and

·; Profits and losses on the disposal and impairment of non-current assets and businesses.

These items, which are detailed in note 2 to the financial statements (page 19), are excluded from Business Performance in order to provide readers with a clear and consistent presentation of the underlying operating performance of the Group's ongoing businesses.

New accounting standards and interpretations

A number of amendments to accounting standards issued by the IASB are applicable from 1 January 2012. They have not had a material impact on the Group's financial statements for the quarter ended 31 March 2012.

2. Disposals, re-measurements and impairments

Revenue and other operating income

Re-measurements included within revenue and other operating income amount to a charge of $53 million for the quarter (2011 $408 million charge), of which a charge of $23 million (2011 $51 million charge) represents non-cash mark-to-market movements on certain long-term gas contracts. Whilst the activity surrounding these contracts involves the physical delivery of gas, the contracts fall within the scope of IAS 39 and meet the definition of a derivative instrument. In addition, re-measurements include a $30 million charge for the quarter (2011 $357 million charge) representing unrealised mark-to-market movements associated with economic hedges.

Disposals of non-current assets and impairments

During the first quarter, disposals and write-offs resulted in a pre-tax charge to the income statement of $3 million (post-tax $2 million charge).

During the first quarter of 2011, disposals and write-offs resulted in a pre-tax charge to the income statement of$5 million (post-tax $8 million credit).

Net finance costs

Re-measurements presented in net finance costs include mark-to-market movements on certain derivatives used to hedge foreign exchange and interest rate risk, partly offset by foreign exchange movements on certain borrowings.

Taxation

During the first quarter of 2011, taxation included a $47 million credit which primarily relates to the impact of the increase in North Sea taxation on re-measurement balances.

3. Segmental analysis

a) External sales are attributable to segments as follows: E&P $2 648 million (2011 $2 293 million), LNG $2 230 million (2011 $1 715 million) and T&D $902 million(2011 $785 million). Intra-group sales are attributable to segments as follows: E&P $182 million (2011 $225 million) and LNG $71 million (2011 $nil).

b) Business Performance Other operating income is attributable to segments as follows: E&P $(4) million (2011 $(8) million), LNG $(1) million (2011 $18 million) and T&D $1 million (2011 $nil).

3. Segmental analysis continued

4. Net finance (costs)/income

a) In 2012 includes foreign exchange losses of $9 million (2011 $22 million).

b) Relates to the unwinding of the discount on provisions and amounts in respect of pension obligations which represent the unwinding of discount on the plans' liabilities offset by the expected return on the plans' assets.

c) Net finance (costs)/income on disposals, re-measurements and impairments for the quarter of $(5) million (2011 $5 million) is included in note 2 (page 19) and principally reflects mark-to-market movements on certain derivatives used to hedge foreign exchange and interest rate risk, partly offset by foreign exchange movements on certain borrowings.

d) Excludes the Group's share of net finance costs from joint ventures and associates for the quarter of $15 million (2011 $14 million).

5. Taxation

a) Prior period taxation relates to the revision of deferred tax balances at 1 January 2011, primarily as a result of the increase in North Sea taxation announced in March 2011.

Business Performance taxation for the first quarter, including share of taxation from joint ventures and associates, is$1 049 million (2011 $849 million excluding prior period taxation). The effective tax rate of 45% for the first quarter is based on the best estimate of the weighted average annual income tax rate expected for the full year.

6. Earnings per ordinary share - continuing operations

Basic earnings per share calculations in 2012 are based on the weighted average number of shares in issue of3 395 million for the quarter.

The earnings figure used to calculate diluted earnings per ordinary share is the same as that used to calculate earnings per ordinary share given above, divided by 3 416 million for the quarter, being the weighted average number of ordinary shares in issue during the period as adjusted for dilutive equity instruments.

7. Reconciliation of net borrowings(a) - First Quarter

Net borrowings attributable to Comgás as at 31 March 2012 were $1 099 million (31 December 2011 $963 million).

As at 31 March 2012, BG Group's share of the net borrowings in joint ventures and associates amounted to approximately $1.8 billion, including BG Group shareholder loans of approximately $1.2 billion. These net borrowings are included in BG Group's share of the net assets in joint ventures and associates which are consolidated in BG Group's accounts.

a) Net borrowings are defined on page 31.

Net borrowings comprise:

a) These items are included within commodity contracts and other derivative financial instrument balances on the balance sheet.

b) Includes finance lease receivable of $194 million (2011 $193 million) included within non-current assets on the balance sheet.

7. Reconciliation of net borrowings - First Quarter continued

Liquidity and Capital Resources

All the information below is as at 31 March 2012

The Group's principal borrowing entities are: BG Energy Holdings Limited (BGEH), including wholly owned subsidiary undertakings, the majority of whose borrowings are guaranteed by BG Energy Holdings Limited (collectively BGEH), and Comgás and Gujarat Gas which conduct their borrowing activities on a stand-alone basis.

BGEH had a $4.0 billion US Commercial Paper Programme, of which $3 650 million was unutilised, and a $2.0 billion Eurocommercial Paper Programme, of which $1 850 million was unutilised. BGEH also had a $15.0 billion Euro Medium Term Note Programme, of which $7 980 million was unutilised.

BGEH had aggregate committed multicurrency revolving borrowing facilities of $4.50 billion, of which $2.32 billion expires in 2013 and $2.18 billion expires in 2016. There are no restrictions on the application of funds under these facilities, which were undrawn as at 31 March 2012.

In addition, BGEH had uncommitted borrowing facilities including multicurrency lines, overdraft facilities of £45 million and credit facilities of $20 million, all of which were unutilised.

Comgás had committed borrowing facilities of Brazilian Real (BRL) 1 775 million, of which BRL 24 million was unutilised, and uncommitted borrowing facilities of BRL 390 million, of which BRL 28 million was unutilised.

8. Quarterly information: earnings and earnings per share

9. Commitments and contingencies

Details of the Group's commitments and contingent liabilities as at 31 December 2011 can be found in note 24,page 127 of the 2011 Annual Report and Accounts.

There have been no material changes to the Group's commitments in respect of capital expenditure in the three month period to 31 March 2012. There have been no material changes to the Group's other commitments and contingent liabilities in the period.

10. Related party transactions

The Group provides goods and services to, and receives goods and services from, its joint ventures and associates. In addition, the Group provides financing to some of these parties by way of loans. Details of related party transactions for the year ended 31 December 2011 can be found in note 25, page 129 of the 2011 Annual Report and Accounts. There have been no material changes in these relationships in the three month period to 31 March 2012. No related party transactions have taken place in the first three months of the current financial year that have materially affected the financial position or the performance of the Group during that period.

Supplementary information: Operating and financial data

a) Capital investment on a cash basis includes acquisitions for the quarter of $nil (first quarter 2011 $319 million; fourth quarter 2011 $nil).

Supplementary information: Operating and financial data continued

Supplementary information: Operating and financial data continued

Historical information

Supplementary information: Operating and financial data continued

Historical information continued

Further historical supplementary information is available on the BG Group plc website: www.bg-group.com

Glossary