The financial ratings agency Standard & Poor's recently assigned its single-A-minus rating to the $1.3-billion Oman LNG LLC term loan facility and to its LOC facility with a stable outlook.
Oman LNG is a two-train liquefied natural gas (LNG) plant in Oman that has been in commercial operation since April 2000, with an annual capacity of 6.6 million metric tons. The company recently received $1.3 billion loan from commercial banks to refinance its existing debt facilities.
The single-A-minus rating, which is two notches higher than that of the Government of the Sultanate of Oman balances credit enhancements contained in the project structure, including subordination of certain gas payments, no foreign currency exposure risk and controlled offshore bank accounts, with regional event risks closely intertwined with the Oman credit risks.
These enhancements, combined with the project's strategic importance to its sponsors and KOGAS, as LNG buyer, allow Standard & Poor's to conclude that the project's debt rating is stable and should not erode. However, long-term political risk in the region, as captured by the Omani foreign currency rating, and the single-asset nature of the project will limit upward rating movement for the foreseeable future.
Oman LNG is 52 percent owned by the Government of Oman, 30 percent owned by Shell Gas with remaining shares divided between TotalFinaElf, Korea LNG, Partex, Mitsubishi, Mitsui & Company. Limited and the Itochu Corporation. — (menareport.com)
© 2001 Mena Report (www.menareport.com)
