Fitch Ratings has affirmed National Joint-Stock Company Naftogaz of Ukraine's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'B' with the stable outlook.
"The affirmation reflects the continued equalization of Naftogaz's ratings with those of Ukraine (B/Stable) under Fitch's government-related entities (GRE) rating criteria. This reflects Naftogaz's strong links with the sovereign," Fitch Ratings said in a statement on its website on March 29.
Read alsoNaftogaz plans to go for IPOThe agency also noted that Naftogaz's Standalone Credit Profile (SCP) at 'b-', mainly reflecting volatility in operations after the unbundling, uncertainty about domestic price regulation and collectability of receivables with a weaker domestic economy and FX exposure.
"We expect liquidity to be under pressure due to high anticipated capital expenditures as Naftogaz invests in its resource base to over time arrest a decline in gas production," the report said.
NJSC Naftogaz of Ukraine is the country's largest state-run vertically integrated oil and gas holding whose subsidiaries account for about 90% of oil and gas production in Ukraine.
Naftogaz develops oil and gas fields, and produces crude oil and natural gas.
Its core business is also transportation and trade in fuel through its own network of filling stations.