Fitch Ratings has affirmed OAO Novatek’s Long-term foreign currency Issuer Default Ratings (IDR) at ‘BBB-‘ with a Stable Outlook.
Novatek’s ‘BBB-‘ rating reflects its strong business profile as Russia’s second-largest natural gas producer and exporter of stable gas condensate and other liquids, its relatively low price risks untypical for the industry, and manageable debt load. The ratings also reflect Novatek’s medium operational scale, country risks due to its concentration in Russia and uncertainties about how its Yamal LNG megaproject will be financed, Fitch said in a statement.
Sanctions imposed on Novatek by the US in July 2014 have not yet triggered any negative rating actions, in view of Novatek’s sound liquidity. They have not affected the company’s day-to-day operations. However, already enacted and possible future sanctions may be negative in the long term and could delay the Yamal LNG project, Fitch added.
Press Release, September 10, 2014; Image: Novatek