Empresa Nacional del Petroleo

Under these conditions, the company has proactively tackled the renewal of its short-term credit facilities, refinancing short-term financial commitments and preserving liquidity. Out of $654 million of short-term debt as of March 31, 2020, $480 million consists of short-term facilities and amortizations of loans with local and international banks, which ENAP has mostly rolled over. The balance of $174 million represents the amortization of international bonds that we believe ENAP will be in a position to repay with no problems (pre-funded as of June 30). Thus, we maintain our view that ENAP's ability to roll over its relatively large short-term bank debt is proof of the company's good access to refinancing, good standing in credit markets, and sound relationships with

...We expect Empresa Nacional de Petroleo (ENAP), as a government-owned company that plays a material role in the domestic economy, to receive ongoing and extraordinary support from the government in case of financial distress. The ratings on ENAP continue to reflect our opinion that there's a very high likelihood that its owner, Chile (foreign currency: A+/Negative/A-1; local currency: ##-/Negative/A-1+), would provide timely and sufficient extraordinary support to the company in the event of financial distress. We base our assessment on our view of ENAP's very important role as Chile's only domestic oil refiner, and its ability to supply about 60% of the domestic market's needs (the remainder is supplied by imports). The company also has a very strong link to the government, particularly regarding debt authorization, business plans, budget approvals, and tax payments. In addition, the company received a capital contribution of $400 million in 2018 from the government. We believe that this...

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