Moody's may cut Citic Resources

Moody's Investors Service said it put on review for possible downgrade the Ba3 corporate family rating of Citic Resources Holdings Ltd. and the Ba3 rating of the $1 billion seven-year unsecured senior notes issued by Citic Resources Finance (2007) Ltd. and guaranteed by Citic Resources.

The action is in response to Citic Resources' loss, attributable to shareholders for the first half of 2009, which is below a previous expectation of the company's performance, Moody's said.

Moody's also said it is concerned over Citic Resources' ability to comply with the interest coverage covenant under its $280 million syndicated facility.

The slower than expected ramp up in production at the Karazhanbas oil field, together with the challenging global demand and price conditions in various commodities segments, will instill continued pressure on the company's profitability and cash flow, the agency added.

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