Moody's announces completion of a periodic review of ratings of Pertamina (Persero) (P.T.)

(Singapore, November 11, 2021) -- Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Pertamina (Persero) (P.T.) and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review discussion held on 9 November 2021 in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. The review did not involve a rating committee. Since 1 January 2019, Moody's practice has been to issue a press release following each periodic review to announce its completion.

This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future. Credit ratings and outlook/review status cannot be changed in a portfolio review and hence are not impacted by this announcement. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history.

Key rating considerations are summarized below.

Pertamina (Persero) (P.T.)'s Baa2 issuer rating primarily reflects its standalone credit quality, as captured in its baa3 Baseline Credit Assessment (BCA), and Moody's expectation of the very high likelihood of extraordinary support from the Government of Indonesia (Baa2) and very high dependence between the two, which results in one notch of uplift. As Indonesia's national oil company, Pertamina has a strategic and important role in oil and gas exploration, petroleum product distribution and gas distribution in the country.

The baa3 BCA is supported by its integrated oil and gas operations, significant upstream production and hydrocarbon reserves, and a large-scale downstream business with substantially full control of Indonesia's refineries, fuel marketing stations and gas pipelines.

However, the rating is constrained by its exposure to an evolving regulatory environment in Indonesia, higher working capital requirements due to time lag to receive compensation from the government for the disparity in the selling prices of fuel, and high execution risk associated with its sizable investment plan.

This document summarizes Moody's view as of the publication date and will not be updated until the next periodic review announcement, which will incorporate material changes in credit circumstances (if any) during the intervening period.

The principal methodologies used for this review were Integrated Oil and Gas Methodology published in September 2019 and Government-Related Issuers Methodology published in February 2020. Please see the Rating Methodologies page on www.moodys.com for a copy of these methodologies.

This announcement applies only to EU rated, UK rated, EU endorsed and UK endorsed ratings. Non EU rated, non UK rated, non EU endorsed and non UK endorsed ratings may be referenced above to the extent necessary, if they are part of the same analytical unit.

This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history. (ends)