Page 15 - LatAmOil Week 30 2022
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LatAmOil                                    NEWS IN BRIEF                                          LatAmOil








       The rating action was based on the compa-  interest payments amount to $51mn and capi-  $50mn in cash at all times, Moody’s notes that
       ny’s improved operating results, which have  tal spending in 2022 will hover around $30mn,  PLNG has usually maintained cash amounts at
       strengthen its liquidity position. The rating out-  including about $8mn for the programed major  around $100mn, which, together with its avail-
       look is now stable.                 maintenance and $10mn for the completion of  able revolver, helps protect the company against
         Upgrades, Issuer: Peru LNG (PLNG) Cor-  the shore-tension project.     volatility in prices or volumes.
       porate Family Rating, Upgraded to B2 from B3;   PLNG’s B2 ratings are based on its exposure   The stable rating outlook reflects Moody’s
       Senior Unsecured Regular Bond/Debenture,  to natural gas marker prices volatility; high  view that PLNG’s credit profile will remain rel-
       Upgraded to B2 from B3. Outlook Actions:  operating risk; fluctuating leverage given vol-  atively unchanged in the next 12-18 months as
       Issuer: PLNG, Outlook, Changed To Stable  atile cash flow; small, single operational asset  higher operating cash is directed to fund basic
       From Negative.                      base; and limited access to external funding. In  obligations, such as interest payment, capital
         Ratings Rationale: The action on PLNG’s rat-  2019-2021, high operating risk was evidenced by  spending and debt amortisation, as well as cash
       ings was based on its improved liquidity posi-  recurring plant stoppages either due to external  distributions to shareholders.
       tion, which resulted from its ability to operate at  events or unplanned shutdowns. These risks are   Moody’s Investors Service, July 22 2022
       full capacity since mid-September 2021, when  somewhat counterbalanced by PLNG’s low sup-
       its plant went back on after over 70 days of stop-  ply risk, high capacity utilisation rates, limited
       pages in the year.                  competition risk, minimum foreign-exchange  POLICY
         Moody’s estimates that in the last three quar-  risk, implicit shareholders support and its high
       ters through June 2022, solid commodities prices  relevance to Peru’s trade balance and energy   Ecopetrol announces
       and volumes have helped boost the PLNG’s cash  industry.
       generation, which should continue elevated   PLNG has adequate liquidity. The com-  resignation of VP of
       as compared to 2019-2021 if prices and vol-  pany’s cash on hand amounted to $405mn in
       umes remain relatively stable. Moody’s believes  March 2022 and Moody’s expects it to generate   corporate affairs and
       that there is a low probability that PLNG’s sole  more than enough operating cash flow through
       plant goes through further major unexpected  December 2023 to cover expenses and capital   secretary general
       mechanical problems, as occurred in 2021, con-  spending. The company’s $40mn committed
       sidering that relevant parts were replaced last  revolving credit facility, currently fully availa-  Ecopetrol informs that, effective as of August 18,
       year and the company is about to complete a pro-  ble, matures in March 2023 but Moody’s expects  2022, Mónica Jiménez, Vice President of Corpo-
       gramed major maintenance with no surprises so  PLNG to renew it for another three years upon  rate Affairs and Secretary General, has decided
       far. It is also positive that PLNG’s shore-tension  maturity. Most of PLNG’s accounts payable  to resign from the Company, to take on a new
       vertical units project, aimed at improving the  refer to the $110mn credit received from the  professional challenge with another company.
       ability to deliver cargoes during adverse weather  off-taker SITME. PLNG’s debt maturity is still   María Paula Camacho, current Legal Man-
       conditions, was successfully completed last May.  comfortable because the amortisation of the  ager of New Business & Corporate, who has 24
       Moody’s believes that, from now on, PLNG will  existing notes begins in September 2024 (about  years of experience within the Ecopetrol Group,
       be able to balance its production more equitably  $78mn in amortisation payments, twice a year).  will become the interim Vice President of Cor-
       across the year.                    Management expects to receive certain reim-  porate Affairs and Secretary General, effective as
         For 2022 PLNG’s management expects pro-  bursement from property damage insurance, in  of August 18, 2022.
       duction to reach over 215 trillion British thermal  connection with the unplanned plant shutdowns   The Company hereby thanks Monica Jiménez
       units (TBtus), about 60% higher than the 133  in 2021, but the amount and timing are still  for her work and the achievements made for the
       TBtus produced in 2021. Therefore, Moody’s  unclear. PLNG’s shareholders, mostly financially  Ecopetrol Group.
       expects PLNG’s EBITDA to reach over $300mn  strong and capable of providing support, helped   Ecopetrol is the largest company in Colombia
       in 2022, as compared to $145mn in 2021, if  the company with liquidity support in 2021.  and one of the main integrated energy compa-
       Henry Hub averages $5.0 per million BTU in the  Moody’s expects PLNG to pay dividends in 2022.  nies in the American continent, with more than
       year, as per the rating agency’s estimates. Annual  Although the company must keep a minimum of  18,000 employees. In Colombia, it is responsible
                                                                                for more than 60% of the hydrocarbon produc-
                                                                                tion of most transportation, logistics, and hydro-
                                                                                carbon refining systems, and it holds leading
                                                                                positions in the petrochemicals and gas distribu-
                                                                                tion segments. With the acquisition of 51.4% of
                                                                                ISA’s shares, the company participates in energy
                                                                                transmission, the management of real-time sys-
                                                                                tems (XM), and the Barranquilla-Cartagena
                                                                                coastal highway concession. At the international
                                                                                level, Ecopetrol has a stake in strategic basins
                                                                                in the American continent, with Drilling and
                                                                                Exploration operations in the United States (Per-
                                                                                mian basin and the Gulf of Mexico), Brazil, and
                                                                                Mexico, and, through ISA and its subsidiaries,
                                                                                Ecopetrol holds leading positions in the power
                                                                                transmission business in Brazil, Chile, Peru, and
                                                                                Bolivia, road concessions in Chile, and the tele-
                                                                                communications sector.
                                                                                Ecopetrol, July 22 2022


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