** BlueScope Steel Ltd's shares fall as much as 3.5pct to their lowest in nearly 16 months
** Morgan Stanley cuts price target to A$5.12 from A$5.50
** BlueScope, as a member of a lobby group, fears that RoyalDutch Shell's $70 bln planned takeover of BG Group Plc may hurt Australia's eastern gas market
** The lobby group, known as Manufacturing Australia, warnedthat gas users seeking long-term contracts were facing highercosts because of a limited number of suppliers (Reuters Messaging: ruchira.k.thomsonreuters.com@reuters.net)