SOCAR's capex to moderate due to SGC, STAR refinery’s commissioning

Oil&Gas Materials 10 April 2021 12:53 (UTC +04:00)
SOCAR's capex to moderate due to SGC, STAR refinery’s commissioning

BAKU, Azerbaijan, Apr.10

By Leman Zeynalova – Trend:

Fitch Ratings expects Azerbaijani state oil company SOCAR's capex to moderate, Trend reports citing the agency.

Fitch’s forecasts are based on the fact that SGC and the STAR refinery in Turkey, SOCAR's two large projects developed together with partners and not consolidated on the company's balance sheet, have been brought on stream and should not require material additional capital injections.

“However, we have limited visibility over possible cash outflows related to its other projects, such as its upstream projects and modernization of the Heydar Aliyev refinery. Given this limited transparency we put more emphasis on SOCAR's historical performance when assessing its credit profile.

As of 31 December 2020, SOCAR's liquidity sources amounted to around AZN8 billion, including cash balances and undrawn committed credit lines. This compares with AZN8 billion of short-term debt, including put option liabilities related to a Goldman Sachs transaction, which SOCAR is planning to refinance. Even though SOCAR's standalone liquidity is tight, we expect the state to provide support should the need arise,” said the agency.


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