Singapore - QNA
Large capital-spending programmes and acquisitions will remain key sources of pressure for the standalone credit quality of many investment-grade oil and gas companies in Asia, said Moody’s Investors Service. Moody’s Vice President and Senior Credit Officer, Simon Wong, said the companies at the lower end of the investment-grade rating scale will continue to face greater pressure from large debt-funded acquisitions and capital spending. “Acquisitions of oil and gas assets with long development lead time are subject to greater execution delays or cost overruns, a credit negative. “If acquisitions accelerate production output and diversify oil and gas reserves, then the pressure from large debt-funded acquisitions will reduce,” he said. Wong was speaking on the just-released Moody’s report titled, ‘Asia Pacific Oil and Gas Industry: Exploration and Production: Acquisitions, Investments Pressure Fundamentals of Some Asian Oil Companies’.