Fitch: Ecopetrol notes BBB-

Fitch Ratings said it expects to assign a BBB- rating to Ecopetrol SA's proposed issuance of up to $2.5 billion notes.

The proceeds will be used for general corporate purposes, including capital expenditures, Fitch said. The notes are expected to have between five-year to 30-year terms.

The rating on the notes is the same as the company's long-term issuer default rating of BBB-.

Ecopetrol's ratings are linked to the credit profile of the Republic of Colombia, which owns 88.5% of the company's total capital, the agency said.

The company is also linked closely with the Colombian government through its reliance upon the receipt of the price difference from selling fuel in the local market instead of the export market, Fitch said.

The company generates about 20% of government revenues and is of great strategic importance to the country, the agency said.

But, Ecopetrol's growth strategy is aggressive and could be challenging for the company, Fitch added.

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