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CRISIL places Gujarat Gas Company’s debt instruments on ‘Rating Watch’

15 Oct 2012 Evaluate

CRISIL has placed its long and short-term ratings on the debt instruments and bank facilities of Gujarat Gas Company (Gujarat Gas) on ‘Rating Watch with Negative Implications’. The credit rating agency has also placed its long-term ratings on the bank facilities of Gujarat State Petroleum Corporation (GSPC) Gas Company, a subsidiary of GSPC, distributes natural gas to industrial, commercial and domestic consumers, and compressed natural gas (CNG) as automobile fuel, in Gujarat on ‘Rating Watch with Developing Implications’.

The rating action follows the signing of a definitive agreement by the GSPC Group, comprising GSPC, GSPC Gas and GSPL (Gujarat State Petronet), to acquire British Gas’ (BG) stake of 65.12 per cent in Gujarat Gas. BG’s shareholding is being acquired by GSPC Distribution Networks (GDNL), a wholly owned subsidiary of GSPC Gas.

Gujarat Gas, a 65.12 per cent subsidiary of BG Asia, is India’s largest private sector natural gas distribution company in terms of sales volumes, with operations in Gujarat. The company has a 73-kilometre (km) transmission pipeline from Hazira to Ankleshwar and a distribution pipeline network of over 3900 km across its operating area. The company distributes natural gas to domestic, commercial and industrial consumers, and compressed natural gas as automobile fuel, in the cities of Surat, Ankleshwar, Bharuch, and surrounding areas.

Meanwhile, GSPC, an undertaking of Government of Gujarat (GoG), is the flagship company of GSPC Group. GSPC is engaged in exploration and production (E&P) of oil and natural gas.

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