Press Release

JCR-VIS Reaffirms Entity Ratings of Jamshoro Joint Venture Limited

Karachi, August 28, 2012: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the medium to long-term entity rating of Jamshoro Joint Venture Limited (JJVL) at ‘A+’ (Single A Plus) and short-term entity rating at ‘A-1’ (A-One). Outlook on the medium to long-term rating is ‘Stable’.

The ratings take into account JJVL’s leading position in local market for the extraction of Liquefied Petroleum Gas (LPG) and Natural Gas Liquid (NGL). Gross margin of the company came under significant pressure during FY11 and further in 9M12. In view of the decline in gross margin, internal cash generation was also impacted. During FY11, the company had to mobilize additional short-term credit lines, to finance working capital needs.

Supply of gas has witnessed an improvement since March, 2012 after completion of equipment installation at the wellhead. The inlet gas plateau is expected to improve further by December, 2012 which would enhance capacity utilization. Furthermore, the company has entered into a processing agreement with Oil and Gas Development Company Limited to process and extract gas for two years from Kunnar & Pasakhi Deep Field which will improve the profitability. JJVL Unit- II, once operational, will also help in expanding revenue base; the management has projected it to come online in early 2013.

For further information on this rating announcement, please contact Ms. Sobia Maqbool, CFA (Ext: 506) at 021-35311861-70 or fax to 021-35311873 or Mr. Maimoon Rasheed at 042-36610681.

Jamal Abbas Zaidi
Deputy CEO

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited VIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2012 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited