Moody's confirmed Bashneft rating as Ba1 with "negative" outlook

UFA, 4 May 2016. /Bashinform News Agency, Olesya Seregina/. The rating agency Moody's Investors Service confirmed the corporate credit rating of PJSOC Bashneft on the level of Ba1. The rating outlook is "negative". According to the oil company, the decision is taken on the basis of the ratings review initiated by Moody's.

According to the Moody's Vice President — Senior Credit Officer Denis Perevezentsev, the decision to confirm the rating of Bashneft reflects the assumption of the Agency that the company will be able to maintain solid credit metrics in a «lower-for-longer» oil price environment helped by rouble weakness and a favourable tax system.

Moody's reminds that the rating confirmation was connected with the fact that in January the agency placed ratings of 32 oil and gas and service companies in the list on review for downgrade.

Bashneft is a vertically integrated oil company operating in more than 20 regions of Russia and abroad. By results of 2015 the company ranked sixth among Russian oil companies for the extraction (19.9 million tons) and the fourth - the primary processing (19.1 million tons). The company has proven oil reserves for 16.3 years.

The controlling shareholder of Bashneft is the Russian Federation represented by the Federal Property Management Agency (50.08 percent of the authorized capital). The Republic of Bashkortostan owns a blocking stake (25 percent plus one share). The Russian government plans to privatize the block of shares belonged to it during 2016. Terms of privatization have not been announced yet. In 2015, the income of Bashneft amounted to 611 billion rubles, and EBITDA of the company adjusted by Moody's amounted to 138 billion rubles.