Moody's rates Gazprom notes A3

Moody's Investors Service said it assigned a provisional rating of A3 to the proposed loan participation notes issue to be launched shortly by Gaz Capital SA. The notes will be euro-denominated and will be placed within the framework of $30 billion loan participation notes program. The proceeds from the issue will be on-lent to OJSC Gazprom for general corporate purposes therefore noteholders are relying solely on Gazprom's credit quality to service and repay the debt. The obligation of Gazprom will rank senior unsecured and will be pari passu with other senior unsecured obligations of the company.

The outlook is stable.

Moody's said it regards Gazprom as a government-related issuer.

Based on Gazprom's robust 2006 results and Moody's current expectations of the group's future operating performance and cash flow generation, the agency said it believes Gazprom enjoys sufficient headroom and financial flexibility to accommodate the additional debt within the current A3 rating.

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