The rating on PTT Exploration and Production Public Co. Ltd. (PTTEP) reflects the Thailand-based company's strategic importance to PTT Public Co. Ltd. (PTT; BBB+/Stable/--) and the government of Thailand (foreign currency BBB+/Stable/A-2; local currency A-/Stable/A-2; axAA/axA-1). The rating also highlights PTTEP's strong domestic position, solid asset base, and modest financial risk profile. The company's dependence on PTT for almost all its revenue and its aggressive growth plans partly offset these strengths. PTTEP is also exposed to execution risk for the development of its substantial proven but undeveloped fields, and related heavy capital requirements. PTTEP's operational and financial performance for the first six months of 2011 is in line with our expectation. Stable production and higher average selling prices have reduced
