Moody's gives CNPC notes A1

Moody's Investors Service said it assigned an A1 rating to the guaranteed senior dollar-denominated notes to be issued by CNPC General Capital Ltd., a special purpose vehicle incorporated in the British Virgin Islands, and indirectly owned by China National Petroleum Corp. (CNPC, Aa3 stable).

The notes will be guaranteed by CNPC Finance (HK) Ltd. (A1 stable), which is in turn supported by its immediate parent, China Petroleum Finance Co. Ltd. (unrated), and its ultimate parent, CNPC, in the form of keepwell agreements.

The outlook is stable.

Proceeds will be used for CNPC's overseas operations.

Moody's said one of the key rating factors is the close linkage of both the guarantor, CNPC Finance, and its parent, China Petroleum Finance, with their ultimate parent CNPC, as well as the two companies' strategic importance within the group, given their roles as the only entities managing CNPC's onshore and offshore treasury operations. Because of these close relationships, the agency believes that there are strong reputational, financial and operational incentives for CNPC to support both China Petroleum Finance and CNPC Finance, if required.

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