Fitch lowers Eurasia Drilling view to stable

Fitch Ratings said it revised the outlook on Eurasia Drilling Co. Ltd. to stable from positive.

The agency also said it affirmed the company’s long-term foreign- and local-currency issuer default ratings at BB, short-term foreign- and local-currency issuer default ratings at B and national long-term rating at AA-(rus).

The agency also affirmed OOO Burovaya Kompaniya Eurasia’s senior unsecured rating at BB and national senior unsecured rating at AA-(rus), along with EDC Finance Ltd.’s senior unsecured rating at BB.

Fitch said news that Schlumberger Ltd. is acquiring a stake in Eurasia Drilling will ultimately benefit the company.

But, risks for the deal include current low oil prices and weak ruble, the agency said.

And there remains a risk that the company will adopt more aggressive financial policies under its new ownership structure, although Fitch said that is unlikely.

On Jan. 20, Schlumberger announced that it agreed to pay $1.7 billion for a 45.65% stake in Eurasia Drilling, the agency said.

Closer cooperation between Eurasia Drilling and Schlumberger is expected to improve Eurasia’s operations and profitability due to technological, operational and financial synergies, Fitch said.

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