Uzbekistan Hails Debut International Rating for State Energy Giant
The Uzbekistan Ministry of Energy today welcomed the debut rating for the state-owned Uzbekneftegaz JSC (UNG) by Fitch Ratings, a major milestone towards the creation of a market-based energy sector in the nation.
Fitch has assigned a rating of BB- with stable outlook to UNG, following the oil and gas company’s comprehensive restructuring over the past four years.
Alisher Sultanov, Uzbekistan’s Minister of Energy, said:
“This is an important step for UNG, for the energy industry in general and for the nation’s future. When my ministry was formed in 2019, one of our tasks was to supervise the restructuring of UNG and other state-owned assets in the energy sector into commercial enterprises compliant with international standards and capable of attracting international capital. UNG’s international rating is an important step towards that objective and will be followed soon by rating assignments for several other energy-related enterprises.”
Fitch’s rating, announced this week, matches that assigned to the Uzbekistan state’s international borrowings. In explaining the basis for the rating, the agency stated that it was based in part on its close relationship with the state, low risk of default and high, but declining, debt burden.
“UNG has benefited from the 2020 abolition of regulated prices for condensate, oil and oil products through higher revenues,” the Fitch announcement stated. “The Uzbek government currently plans to liberalise prices for natural gas, UNG’s main product, and liquefied petroleum gas (LPG) in 2022, which may considerably increase UNG’s profitability if the collectability of receivables does not deteriorate.”
