Fitch downgrades Net4gas

Fitch Ratings said it downgraded Net4gas, sro's long-term issuer default rating and senior unsecured rating to BB+ from BBB and kept them on rating watch negative.

“The downgrade reflects our view of substantially higher risk to Net4gas' long-term ship-or-pay contracts with Gazprom, in combination with the current level of indebtedness and the deterioration of the key counterparty's credit quality,” Fitch said in a press release.

The view is derived from the increasingly tougher sanctions between Europe and Russia, which could prevent scheduled payments from Gazprom in case of further measures, and from Europe's firm commitment to strongly reduce their reliance on Russian gas, the agency said.

“While Net4gas' infrastructure could accommodate alternative flows, and thus receive capacity bookings also to service eastern Europe in the medium term, visibility on this is currently limited,” Fitch said.

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