* Raises 2015 production target to 680,000-700,000 boepd
* Quarterly EBITDA down 37 pct to $1.24 bln
* 2016 capex to be "meaningfully" lower - CFO (Repeats to add link to Breakingviews story, no change to text)
By Karolin Schaps
LONDON, Oct 30 (Reuters) - BG Group raised its 2015production guidance for the second time this year on Friday asBritain's third-biggest energy company posted a sharp butbetter-than-expected fall in third-quarter earnings.
BG, which has accepted a $70 billion takeover offer fromShell, cited higher-than-expected output from fields inBrazil and Australia for its higher production guidance.
Its quarterly core earnings fell 37 percent to $1.24billion, better than the $1.16 billion consensus estimate ofanalysts polled by the company.
A day earlier BG's acquirer Shell missed third-quarterexpectations as it took an $8.2 billion charge after scrappingprojects in the Arctic and Canada.
A continued fall in oil prices since Shell's acquisition wasannounced in April has raised concerns among investors that itmay be overpaying for BG.
BG's third-quarter performance could help restoreshareholders' confidence in the deal.
"It's a good, solid performance," said Oswald Clint, senioranalyst at Bernstein.
"We probably need a few more quarters to convince investors(about the value of the deal) but I believe there will be morequarters showing numbers like this."
BG's shares were down 0.1 percent at 0855 GMT on a Europeanoil and gas index down 0.7 percent.
One of BG's most attractive elements which Shell hashighlighted is the company's flourishing liquefied natural gas(LNG) business.
BG said on Friday it expected the unit's EBITDA to hit themiddle of a $1.3-1.5 billion range this year, despite a fall inLNG prices.
BG's average realised gas price fell 34 percent in the thirdquarter and oil prices were down 48 percent year on year.
The company, which typically gives a yearly capitalexpenditure guidance at full-year results, said it would be"meaningfully lower" in 2016 than the $6.5 billion it intends tospend this year.
"That is partially about disciplined investment and managingour portfolio to really focus on these investments (in Braziland Australia) that drive value in a period of low oil prices,"Chief Financial Officer Simon Lowth said.
BG also plans to save at least $300 million this year incosts, it said.
The gas-focused company raised its 2015 production outlookto 680,000-700,000 barrels of oil equivalent per day (boepd)from 650,000-690,000.
The group's fields lifted third-quarter output to 716,000boepd, up 26 percent from a year earlier.
(Editing by David Goodman and Jason Neely)
