/IRBIS, March 27, 03/ - On February 20 of 2003 Kazkommert Securities OJSC
(Almaty) assigned KazTransOil (Astana), whose bonds are traded in Kazakhstan
stock exchange's (KASE) official "А" listing category, rating "А" with stable
outlook, having estimated by it the company's ability to meet its financial
liabilities.
According to the report about rating assigning, which was presented to IRBIS
for publication, the estimation reflects the company's high ability to fulfill
its debt liabilities in time and entirely regardless of commercial, financial
and economic conditions.
The rating report says that During the last 3 years, KTO demonstrates constant
growth of the basic productive and financial indexes. Oil freight
tonkilometers
has increased from 19 billion ton-kilometers in 2000 to 24 billion
tons-kilometers in 2002. Revenues have grown by 22% in 2001. In 2002, we also
expect increase in revenue by 12% in contrast with 2001 - Kazkommerts
Securities OJSC writes.
Currently the Company operates the system of pipelines with the total length of
6,400 km. Furthermore, КТО elaborates a number of projects aimed at
transportation routs optimization, such as construction of Kumkol-Aralsk-Atyrau
and Kenkiyak-Atyrau pipelines.
The existing system of tariff regulation allows KTO to cover the oil pumping
costs. Therewith, the world oil prices are not effective in the KTO's tariff
determination.
In 2002, the oil and condensate production totals 47.2 mln tons. KTO
transported over the 65% of the total oil produced in Kazakhstan. Provided the
expected oil production growth in the Republic, KTO will increase oil
transportation volume of its pipeline system up to 70 mln tons per year by
2010.
The start-up of Caspian Pipeline Consortium (CPC) is expected to lower the
market share of KTO insignificantly in short-term. However, in long-term, the
market share of the Company will increase due to the total oil production
growth and implementation of new transportation facilities.
Realization of projects on unification of the company's all main pipelines and
support of them in necessary technical condition requires significant
investments. Specialists of Kazkommerts Securities OJSC assume KTO will borrow
a part of funds, which are necessary for increasing of capacities,
reconstruction and modernization of main pipelines, due to foreign borrowings
that will increase the debt burden of the company.
A KTO export volume is affected by the transit quote imposed by Russia. The
increase of export quote for Kazakhstani oil from 17.5 mln tons to 19.5 mln
tons in 2003 will also have a positive effect on the Company's operations.
Explaining the stable outlook of the rating, Kazkommerts Securities OJSC writes
that Oil and gas industry is one of the most attractive for investors. As the
planned production of oil in Kazakhstan will grow, the need for additional
transportation capacity and decrease of transportation costs arises.
As a leading oil transportation operator in Kazakhstan, CJSC "KazTransOil"
develops a number of projects on transportation routes optimization over the
territory the country as well as abroad. The implementation of Kenkiyak-Atyrau
pipeline will allow deliver the oil from Aktobe region directly to the Atyrau-
Samara export pipeline that will cause the increase of the KTO's profits.
Introduction of export oil pipeline CPC, in the opinion of specialists of
Kazkommerts Securities OJSC, will not significantly influence financial indexes
and perspectives of due to CPC's linkage to a distinct group of oil fields.
"We deem that continuous enhancement of KTO's tariff policy will allow the
company maintain its leading position in the nearest future - the report says.
Besides the issuer's rating, Kazkommerts Securities OJSC has assigned ratings
to bonds of KTO:
internal of the first issue (KZ73LAONAA35; KASE's trade code - KZTOb;
$100; $30.0 m; October 23, 00 - October 23, 03; semi-annual coupon 9.0%
APR) - "А";
euronotes of senior unsecured debto f the first issue (XS0132391938;
KZTOe1; $150.0 m; July 6, 01 - July 6, 06; semi-annual coupon 8.5% APR) -
"А-".
Original version of the rating report of Kazkommerts Securities OJSC concerning
CJSC "KazTransOil" was published today in the KASE's web-site in
http://www.kase.kz/emitters/rt_kkb/kzto_rt.pdf.
Ratings scale, which is used by Kazkommerts Securities OJSC, is greatly looks
like the scale of Standard & Poor's. Group of ratings "А" (ААА, АА и А) means
high ability of issuer to fulfill financial obligations, group "В" (ВВВ, ВВ и
В) - sufficient ability in presence of sensibility for unfavorable economic and
financial conditions. Credit ratings of the group "С" (ССС, С и С) mean that at
present the company is in unfavorable situation, however still fulfills its
financial obligations. Credit rating "SD" means selective non-fulfillment of
separate types of financial obligations by the company, and rating "D" -
non-fulfillment of all financial obligations. The scale comprises intermediate
gradations ("+" and "-"), and also usage of ratings' outlook, which, according
to the words of officials of Kazkommerts Securities OJSC, reflects possibility
of ratings changing or their stability in nearest future.
Till present the following companies received estimation from Kazkommerts
Securities OJSC:
- Karazhanbasmunai (Aktau) - "ВВ"/stable, bonds rating - "ВВ-" (November
20, 02);
- Hurricane Hydrocarbons Ltd. (head office - Kalgari, Aiberta, Canada) -
"ВВВ"/positive, rating of 12% bonds - "ВВВ" (November 20, 02);
- Zhayremskiy OMPE OJSC (Zhairem, Karaganda oblast) - "В"/stable
(January 15, 03), bonds rating - being examined.
[2003-03-27]