Moody's rates GS Caltex notes Baa1

Moody's Investor Service said it has assigned a Baa1 long-term rating to the proposed senior unsecured notes of $300 million to be issued by GS Caltex Corp. The rating outlook is stable.

The Baa1 rating reflects the company's position as the second largest refining company in Korea, its solid financial and operating profile and supportive regulatory environment, Moody's said.

The rating also recognizes the company's strong association with Chevron Corp. (rated Aa2), which owns 50% of the company and views GS Caltex as part of its Asian downstream strategy.

Moody's said the rating also considers the inherent cyclicality of the refining and marketing sector, GC Caltex's active capital expenditure program to upgrade existing operations and expand into the liquefied natural gas business, which raises execution risk for the company.

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