S&P gives Pemex notes BBB

Standard & Poor's said it assigned its BBB rating to Petroleos Mexicanos' (Pemex) €$1.3 billion 3 1/8% fixed-rate senior unsecured notes due 2020.

The agency based its assessment of the company's bbb- standalone credit profile and an "almost certain" likelihood of extraordinary support from the Mexican government. The company's standalone credit profile, in turn, is derived from Pemex's "satisfactory" business risk profile given the its monopoly status in the large national oil and gas market, substantial oil and gas reserve base and central role in Mexico's energy sector.

S&P said the rating also reflects its "significant" financial risk assessment based on Pemex's weak after-tax financial performance and aggressive capital expenditures program.

The notes benefit from Pemex Exploracion y Produccion, Pemex-Refinacion and Pemex-Gas y Petroquimica Basica's irrevocable and unconditional payment guarantee. These three entities are Pemex's subsidiaries.

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