Credit rating for Dung Quat refinery operator could reach positive level BB-/BB: Mizuho

Binh Son Refining and Petrochemical JSC, operator of Vietnam’s oil refinery Dung Quat, can see its credit rating reach the positive level of BB-/BB, according to the Singaporean branch of Japanese bank Mizuho.

A representative of the bank affirmed the prediction on Thursday while consulting with the oil refinery operator, listed on the unlisted public company market (UPCoM) as BSR, on the latter’s credit rating.

Mizuho has already made credit rating consultations for state-owned Petrovietnam, which holds a 92% stake in BSR; and PV Gas and PV Power, Petrovietnam's subsidiaries.

Mizuho affirmed BSR currently has the best financial conditions among the businesses under Petrovietnam. The anticipated BB-/BB rating would facilitate BSR to access capital with preferences on the global market and reduce unnecessary guarantee fees.

Dung Quat refinery’s output reached seven million tons of products in 2022, exceeding its designed capacity of 6.5 million tons. BSR earned a post-tax profit of VND14,394 billion ($613.8 million) in 2022, up 115.4% year-on-year, on a revenue of VND167,123 billion ($7.13 billion), up 65.34%.

Vietnam has two operational oil refineries - the Nghi Son Refinery and Petrochemical complex in Thanh Hoa province and Dung Quat Refinery in Quang Ngai province, both in the central region.

Nghi Son is a $9 billion refinery co-owned by Petrovietnam, Kuwait Petroleum Europe B.V. (KPE), and Japan’s Mitsui Chemical and Idemitsu Kosan Co. Dung Quat Refinery is a Petrovietnam subsidiary and has received more than $3 billion in investments.

BSR shares fell 1.22% to VND16,200 ($0.68) on Friday.