Muscat: Energy Development Oman (EDO) has announced that Fitch Ratings has assigned it a Long-Term Issuer Default Rating (IDR) of BB with a Stable Outlook.
According to the agency, EDO’s IDR is constrained by the rating of its sole shareholder, the government of Oman (BB/Stable), given their close links.
The agency also assessed EDO’s Standalone Credit Profile (SCP) at investment grade rating ‘bbb’, supported by large-scale operations and low leverage.
The inaugural assessment by Fitch Ratings is another milestone in EDO’s development, as it serves to enhance the status of Oman’s hydrocarbon and alternative energy sectors as attractive spheres for investment and financing. Furthermore, the rating increases transparency and comparability for debt investors and capital market participants active in the Sultanate.
Commenting on the credit rating, Sultan bin Ali Al Mamari, Chief Financial Officer– EDO, stated, “this assessment by Fitch is a recognition of EDO’s financial strengths as well as the prudent fiscal management of the economy by the Omani government. The rating provides a firm platform to attract multiple forms of investment into the country.”
“As a landmark achievement for EDO, this is an important step towards our objective of leading the energy transition in alignment with Oman’s Vision 2040,” the CFO added.
In their report, Fitch outlined the key drivers that influenced EDO’s rating. These included the Sovereign rating, EDO’s strong financial profile, supportive scale of operations, mature oil reserves base, favourable unit economics and improving ESG footprint. In terms of liquidity and debt structure, Fitch Ratings emphasised EDO’s strong liquidity and no short-term debt.
Energy Development Oman was established in December 2020 by Royal Decree (2020/128) to focus on realising efficiencies and pursuing new growth opportunities in Oman’s energy sector. The company’s stated vision is to be a world-class partner for growth while driving a sustainable energy future.
