Fitch has changed the forecast on ratings of "Gazprom" to "Positive", confirming the ratings at "BBB" level

/IRBIS, August 3, 2011/ - Fitch Ratings has changed from "stable" to "positive" outlook on long-term Issuer Default Ratings ("IDR"), of JCS Gazprom, Russia's foreign and local currency stated in the report released August 2 Fitch. At the same time the agency affirmed the long-term issuer default rating of Gazprom's foreign and local currency at "BBB", its senior unsecured foreign currency rating to "BBB" and short-term foreign currency IDR "F3". Rating debt issuance program Gaz Capital SA affirmed at "BBB". Rating issuance program of commercial paper Gazprom ECP SA affirmed at "F3". According to Fitch "positive" outlook reflects the strengthening of the financial position of Gazprom in 2010 and an expected further improvement of Fitch credit rating company in 2011-2012. Also more favorable state of the gas market, both for export and for domestic sales. As stated in the report, Gazprom will continue to generate positive free cash flow in 2011-2012. At the same time, Fitch expects that the net adjusted leverage of the group will remain below 1x in 2011 (0.9 x in 2010) and an adjusted leverage of funds from operations (FFO) will continue to be in a narrow range 1.3 x - 1.4 x in 2011-2012 (1.4 x in 2010) based on conservative assumptions of Fitch's oil price of $ 75 per barrel in 2011 and $ 65 per barrel in 2012 By assumption of Fitch business and financial results continue to support Gazprom's long-term contracts at prices mostly linked to market prices for oil products in European sales of gas. Long-term contracts, on the one hand, allow gas producers to carry out highly capital projects with long preparatory phase, and potential delays and, on the other hand, lay the foundation for a reliable supply to customers. Furthermore, as stated in the report, Fitch expects to reduce excess supply in the European gas market in the next 2-3 years, against a background of slow economic recovery, growth in demand in Japan, the ever-increasing consumption in China and the planned phasing out of nuclear power stations in Germany. With regard to the projected rating of the company, Gazprom receives the benefits of improved economic performance in sales in Russia and the former Soviet Union. Fitch expects that the Russian government continues to liberalize the domestic gas market by raising gas prices by an average of 15% per year for industrial customers to provide the same return on domestic and export sales of gas by 2015 Another positive factor supporting the Company's financial results was the transition to market prices and improving the payment discipline of sales to countries of the former USSR. The favorable financial impact of these factors is more than sufficient to offset the negative financial impact of increasing the tax on mineral production in 2011, Fitch reports. Fitch also notes the declining transit risk in lucrative Gazprom's export sales of gas to Europe, since the construction of the Nord Stream pipeline with a capacity of up to 55 billion cubic meters going according to schedule, and commissioning of the first phase expected in 2011, also believes that most of the state influence - both positive and negative - are already built into the structure of business groups, and thus are part of the ratings. [2011-08-03]