Moody's assigns ratings to US$ 2.25 billion senior secured amortizing bonds issued by Ras Laffan (II) and Ras Laffan (3)
Moody's Investors Service on Monday assigned definitive long-term ratings of A1 to the USD 2.25 billion senior secured amortising bonds issued by Ras Laffan Liquefied Natural Gas Company Limited (II) and Ras Laffan Liquefied Natural Gas Company Limited (3). The outlook on the ratings is stable.
Moody's definitive ratings confirm the prospective ratings assigned on 25 July 2005. The rating rationale is set out fully in a pre-sale report. Ras Laffan (II) has issued USD 1.4 billion 5.298% Series A bonds, with final maturity in September 2020, which are unconditionally and irrevocably guaranteed by Ras Laffan (3). Ras Laffan (3) has issued USD 850 million 5.838% Series B bonds, with final maturity in September 2027, which are unconditionally and irrevocably guaranteed by Ras Laffan (II).
The Series A bonds have an average life of 10.5 years, and the Series B bonds (which commence amortisation in 2021) have an average life of 19.5 years.
Ras Laffan (II) and Ras Laffan (3) have simultaneously entered into a pari-passu USD 970 million senior secured amortising bank facility agreement due September 2020, and a pari-passu USD 1.38 billion loan agreement with Exxon Mobil Corporation (with three tranches in proportion to the Series A and Series B bonds and the bank facility). The total debt issuance of USD 4.6 billion will be used, together with about USD 3.3 billion equity already invested, to fund the expansion of LNG production facilities in Qatar. Moody's expects that further pari-passu debt will be issued to complete the expansion, subject to the terms of the common security agreement.
The ultimate shareholders of each of Ras Laffan (II) and Ras Laffan (3) are currently Qatar Petroleum (70%) and Exxon Mobil Corporation (30%). Qatar Petroleum is wholly owned by the Government of Qatar (A1), and Moody's has applied its joint default methodology. In line with this methodology, the baseline credit assessment is category four, and support and dependency are assumed to be high. The bonds are non-recourse to the shareholders.
Ras Laffan (II) and Ras Laffan (3) are Qatari LNG companies. In 2004, Ras Laffan (II) reported revenue of USD 758 million. Ras Laffan (3) was formed in July 2005.