City cheers MMC verdict on British Gas: Relying on the UK market

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The Independent Online
BRITISH Gas is heavily reliant on the UK gas market for its profits, accounting for about three-quarters of its operating income of pounds 1.2bn last year, writes Neil Thapar.

The group's second-biggest profits earner is its oil and gas exploration and production division, which has a large presence in the North Sea and Morecambe Bay. The division contributed 13 per cent of group profits and has been expanding its overseas activities. Last year it won the rights to develop a huge oil and gas field in Kazakhstan.

Some analysts believe the MMC recommendations are likely to spur the group into expanding exploration and production worldwide.

Global Gas, a Canadian gas company acquired three years ago, accounted for 8 per cent of group profits last year.

British Gas dominates the UK domestic energy market, serving 18 million customers. Gas is the biggest energy source for commerce and industry.