S&P cuts PT Saka Energi

S&P said it lowered PT Saka Energi and the issue rating on its $625 million senior unsecured notes to B+ from BB.

“We believe PT Saka Energi Indonesia’s strategic importance within parent company PT Perusahaan Gas Negara Tbk. (PGN) has declined given the latter’s increasing focus on transmission and distribution, recurring delays by PGN on extending the maturities on the shareholder loan, and recent communication from PGN on providing support to its subsidiaries,” S&P said in a press release.

The agency also noted the sharp reduction in capital spending on replenishing the reserve base at Saka Energi also signals a reduced commitment by PGN to maintain upstream integration, S&P said.

The outlook is stable.

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