BUSINESS

MOODY'S AFFIRMS PETRONAS LNG'S BAA1 RATINGS WITH STABLE OUTLOOK

18/05/2021 10:31 PM

KUALA LUMPUR, May 18 -- Moody's Investors Service has affirmed the Baa1 foreign and local currency issuer ratings of Petronas LNG Ltd (PLL) with a stable outlook. 

Its analyst, Hui Ting Sim, said PLL's Baa1 ratings are positioned two notches below the A2 ratings of its ultimate parent, Petroliam Nasional Bhd (Petronas, A2 stable).

"The top-down rating approach reflects PLL's full ownership by Petronas as well as its strong operational and financial integration with its parent," she said in a statement.

Petronas is Malaysia's national oil company, which is in turn 100 per cent owned by the Malaysian government (A3 stable).

"Petronas has a firm track record of providing financial support to PLL, as demonstrated by cash injections of S$870 million (S$1=RM3.10) in PLL since 2015,” Moody’s said. 

According to the rating agency, PLL enjoys ongoing liquidity support from Petronas and it can draw from Petronas' umbrella credit facility for liquidity management.

Moody’s said Petronas' support for PLL extends beyond financial assistance. 

“It also provides PLL with significant management support and oversight, including monthly reporting on risk and governance to a committee chaired by Petronas.

“PLL also has an integrated treasury function with Petronas, whereby its cash is held centrally by Petronas and cash flow requirements are shared with its parent,” the agency said.

On PLL’s stable rating, it said this reflects the stable outlook on Petronas and Moody's expectation of continued strong support from and linkages with PLL's ultimate parent.

Moody's said it will consider an upgrade only if Petronas’ rating is upgraded.

-- BERNAMA


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