Rosneft's $25B Debt Seen Rising after Essar Deal
MOSCOW, March 21 (Reuters) - The debts of Russia's top oil producer Rosneft are likely to rise as a result of its plan to buy a non-controlling stake in Indian oil refiner Essar Oil, Moody's credit ratings agency said on Monday.
Rosneft, whose net debt stood at $24.5 billion at the end of September, hopes to conclude a deal to buy a 49 percent stake in the 400,000 barrel-per-day refinery in western India by the end of June.
Denis Perevezentsev, vice-president and lead Rosneft analyst at Moody's, said the deal would be credit negative as it could increase the Russian company's leverage, while not offering any clear benefits.
In a note, Moody's estimated that Rosneft could pay $2-$3 billion for a 49 percent stake in EssarOil.
"The deal's structure has not yet been disclosed, but Rosneft is likely to increase its debt by the amount of the deal if it or a subsidiary purchases the asset for cash," Perevezentsev told Reuters.
Rosneft, under Western sanctions over Moscow's role in the Ukraine crisis which limits its ability to borrow on global markets, will have to repay about $13.7 billion this year.
Moody's also said it treated as a debt-like item the pre-payments of about $43.4 billion received by Rosneft last year under long-term oil and oil products supply deals. Rosneft is yet to publish its full-year 2015 results.
(Reporting by Denis Pinchuk; Editing by Katya Golubkova and Mark Potter)
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Weatherford CEO's Rebound Plan Relies On Getting Smaller
- Iran Says Oil Market Is Too Tight For US Zero Exports Target
- China's Squeezed 'Teapots' Eye Petchem Path To Riches
- Baker Hughes: US Drillers Add Oil Rigs For Second Week In Three
- Venezuela Hands China More Oil Presence, But No Mention Of New Funds
- Falcon Oil Declares Commercial Flow Test Results for Shenandoah Well
- Macquarie Strategists Expect Brent Oil Price to Grind Higher
- Japan Failing to Meet Corporate Demand for Clean Power: Amazon
- UK Oil Regulator Publishes New Emissions Reduction Plan
- Pennsylvania County Joins List of Local Govts Suing Big Oil over Climate
- PetroChina Posts Higher Annual Profit on Higher Production
- US, SKorea Launch Task Force to Stop Illicit Refined Oil Flows into NKorea
- McDermott Settles Reficar Dispute
- Russian Navy Enters Warship-Crowded Red Sea Amid Houthi Attacks
- USA Commercial Crude Oil Inventories Increase
- New China Climate Chief Says Fossil Fuels Must Keep a Role
- Oil Demand Outpaces Expectations, Testing Calculus on Peak Crude
- House Passes Protecting American Energy Production Act
- TotalEnergies Restarts Production in Denmark's Biggest Gas Field
- USA Oil and Gas Job Figures Jump
- Republican Lawmakers Say IEA Has Abandoned Energy Security Mission
- Blockchain Demands Attention in Oil and Gas
- Houthis Warn Saudi Arabia of Retaliation If It Backs USA Attacks
- Macquarie Sees USA Oil Production Exiting 2024 at 14MM Barrels Per Day
- Summer Pump Prices Set to Hit $4 a Gallon Just as Americans Hit the Road
- Chinese Mega Company Makes Major Oilfield Discovery
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Another Major Oilfield Discovery
- New China Climate Chief Says Fossil Fuels Must Keep a Role
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Vessel Sinks in Red Sea After Missile Strike
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension
- Equinor Makes Discovery in North Sea