Moody's lowers Oil and Natural Gas to Baa2

Moody's has downgraded Oil and Natural Gas Corp. Ltd.’s local and foreign currency issuer ratings to Baa2 from Baa1.

At the same time, Moody's has downgraded the company’s baseline credit assessment to baa2 from baa1; the senior unsecured bonds to Baa2 from Baa1; the senior unsecured bonds guaranteed by ONGC and issued by ONGC Videsh Ltd. and ONGC Videsh Vankorneft Pte. Ltd. to Baa2 from Baa1; and the foreign and local senior unsecured ratings on ONGC Videsh Ltd. and ONGC's MTN program to Baa2 from Baa1.

"Despite depleted cash reserves, we expect ONGC to meet is debt repayment obligations given its access to capital as a state-owned company. However, its lower cash reserves have diminished the company's capacity to protect its credit profile from oil price shocks," says Vikas Halan, a Moody's senior vice president.

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