Fitch Rating Upgrades Georgian Oil and Gas Corporation's IDR to 'BB'/Stable

11 March, 2019
The International credit rating agency Fitch Rating has upgraded JSC Georgian Oil and Gas Corporation's (GOGC) Long-Term Issuer Default Rating (IDR) to 'BB' from 'BB-'. The Outlook is Stable. 

Fitch published JSC Georgian Oil and Gas Corporation rating on March 7. 

GOGC is 100%-owned by the Partnership Fund, a fully government-owned investment vehicle. 

GOGC is viewed by the government of Georgia as critical to its national energy policy. GOGC is the primary party in Georgia to gas supply and transit agreements, and is a key government vehicle for ensuring the reliability of gas supplies through cooperation with local distributors and suppliers. 

The Agency underlines the importance of Gardabani-2 thermal power plant project which is scheduled to be launched in 4Q19. The launch of the power plant will significantly improve financial condition of the corporation and increase energy security of the country. Increased volumes of gas transit from Shah-deniz-2 field development will also positively affect the profitability of the company, which will also increase the volumes of gas purchase from the consortium. 

Fitch Rating expects GOGC to maintain solid credit metrics over 2018-2022 due to finalization of the Gardabani-2 power plant and underground gas storage facility projects. 

GOGC is also considering constructing an underground gas storage facility that is estimated to cost USD 250-270 million.