Moody's Investors Service has upgraded CNOOC's issuer rating by a notch, citing the strong financial position of China's dominant offshore oil producer and stable government policy.
CNOOC said the Baa1 (positive) rating was Moody's highest for a Chinese corporation.
The United States-based rating agency raised the ratings of Hong Kong and New York-listed CNOOC and its unlisted parent, China National Offshore Oil, from Baa2 to Baa1. It also raised the foreign currency long-term debt rating of CNOOC's subsidiary, CNOOC Finance (2002), from Baa2 to Baa1. The ratings outlook is positive.
The agency said: 'The positive outlook on the ratings reflects the outlook on the A3 foreign currency ceiling of [China].
'The ratings upgrade reflects CNOOC's consistent track record of maintaining a solid financial profile since the rating was first assigned in 2000 . . . and our expectation for ongoing stability in government policy for the oil and gas sector.'
Moody's expects CNOOC to maintain a cash flow to debt ratio of more than 60 per cent in the next three to five years, even under its undisclosed 'conservative' assumptions about oil-price scenarios.
