Caribbean Information and Credit Rating Services Ltd (CariCRIS) has lowered the assigned credit ratings of NiQuan Energy Trinidad Ltd (NiQuan) to CariB on the regional rating scale and ttB on the TT national scale, as well as jmB on the Jamaica national scale.
In a release on Tuesday, CariCRIS said these ratings indicate "weak" creditworthiness of NiQuan, adjudged in relation to other obligors in the Caribbean and in TT and Jamaica.
It added the lowering of the assigned ratings reflects NiQuan’s inability to attain full commercial operations at the nameplate capacity by September 30 (identified as a factor that could lead to a lowering of the rating in its March report) and the termination of the gas sales contract (GSC) by TT Upstream Downstream Energy Operations Company Ltd (TTUDEOCL), which has become subject to legal proceedings by NiQuan.
"CariCRIS notes the considerable progress made by NiQuan in achieving a proven plant producing zero sulphur diesel and naphtha and (transferring) 15,000 barrels of product to its off-taker, Paria Fuel Trading Company Ltd.
"We will consider revising its ratings upward upon the successful resumption of a long-term GSC, together with successful refinancing of the existing short-term note instruments (STNI) into a longer-term facility," the release said.
ButCariCRIS added it may further lower the ratings if the STNI is not refinanced or extended by December 31 or if any other credit negative events occur before that date.
In September, NiQuan said its plant was offline because the Government was withholding its natural gas supply.
In August, NiQuan filed an injunction against TTUDEOCL to force the state to resume its natural gas supply. Justice Kevin Ramcharan dismissed the application. NiQuan has since appealed the injunction.
Also last month, the Prime Minister insisted Government has assisted “in every way” to ensure NiQuan’s success.
Dr Rowley said the Government had no reason to see NiQuan fail.
“NiQuan and the Government co-operated in introducing to our economy some element of economic expansion. That’s the singular basis on which the Government was involved with NiQuan, a private business,” he said.
NiQuan is reportedly US$250 million in debt.
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