Press Release

JCR-VIS Reaffirms Entity Ratings of Oil & Gas Development Company Limited at AAA/A-1+

Karachi, February 15, 2019: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the medium to long-term entity rating of Oil & Gas Development Company Limited (OGDCL) at ‘AAA’ (Triple A) and short-term entity rating at A-1+ (A One Plus). Outlook on the assigned rating is ‘Stable’. The previous rating action was announced on February 22, 2018.

The assigned ratings of OGDCL incorporate its ownership structure with majority shares held by the Government of Pakistan. The low business risk of the Company emanates from its robust margins providing considerable cushion against international oil price fluctuations. Moreover, OGDCL is the leading Company in exploration and production sector in Pakistan. The Company has an assured product off-take amid excess demand of oil & gas vis-à-vis local supply.

The ratings also take into account low financial risk profile emanating from debt free capital structure and strong liquidity indicators. Furthermore, higher realized price of oil, gas and LPG coupled with increased LPG production and devaluation of Pak Rupee against the US Dollar during the period under review provided impetus to the Company’s profitability. Despite rising trend in industry-wide inter-corporate circular debt, the Company continues to manage its capital expenditure requirements through strong internal cash flows.

For further information on this rating announcement, please contact the undersigned at 021-35311861-70 or Mr. Maimoon Rasheed at 042-35723411-13.

Jamal Abbas Zaidi

Applicable rating criterion: Industrial Corporate (May 2016)

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 not an NRSRO and its credit ratings are not NRSRO credit ratings.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 2019 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