SLAVNEFT (hereinafter, the Company or the Group) is a Russian vertically integrated oil and gas company. The credit rating of the Company is based on the strong assessment of the operational profile, large size of business, high profitability, strong liquidity, and the medium leverage assessment. The rating is constrained by the low assessment of interest payment coverage and the very weak cash flow assessment. The Company is a joint venture of Rosneft (ACRA rating: AAA(RU), outlook Stable) and Gazprom Neft PJSC (ACRA rating: AAA(RU), outlook Stable); hereinafter, the Shareholders. In its rating analysis, ACRA took into account the high likelihood of the Company receiving extraordinary support from the Shareholders.
KEY ASSESSMENT FACTORS
High likelihood of support being provided by the Shareholders. The Shareholders carry out direct operational management of the Group’s companies in accordance with their own strategies and management standards. All oil produced by the Company is sold in equal shares to the Shareholders at market value. The Shareholders ensure the full utilization of the refining capacities of Slavneft-YANOS PJSC, supplying oil in equal shares for refinery. The Shareholders directly participate in long-term planning and form the Company’s production program. The Group is responsible for planning funding sources. According to ACRA’s methodology, the level of support from the Shareholders is assessed as high, which is due to very high ratings for the factors Ability to Provide Support, Barriers and Restrictions, Ownership, Control and Regulation, high rating for the factor Guarantees and Other Channels of Support, as well as medium ratings for the factors Strategic Risk, Brand Risk and Reputational Risk.
The strong operational profile is based on the medium assessment of the Group’s market position, strong business assessment, very strong assessment of geography, and medium assessment of corporate governance. ACRA views the Company as a competitive player in the highly concentrated Russian oil production and processing markets.
The strong assessment of the business stems from the medium score for cost price of production and expenses on replenishing the raw materials base, very high level of hydrocarbon supplies, and the high indicators for volume and depth of refinery.
As the Company only sells products to its Shareholders and therefore has a guaranteed sales market, and also taking into account the high diversification of the Group’s production assets, the geography is assessed as very high.
Medium leverage and low coverage. ACRA estimates the weighted average ratio of total debt to FFO before net interest payments from 2023 to 2028 at 2.8x. The weighted average FFO ratio before net interest payments to interest payments for the same period is estimated by the Agency at 2.3x.
Strong liquidity and very weak cash flow. ACRA expects the Company’s free cash flow to remain negative in 2026 and takes into account the Company’s plans to significantly increase its capital expenses starting from 2027. At the same time, given the volume of open credit lines and broad opportunities to attract financing, the Agency assesses the Group’s liquidity at a high level.
key assumptions
-
Average annual Urals oil price at 57–70 USD/bbl in 2026–2028.
-
Average annual USD/RUB exchange rate at 78–94.3 in 2026–2028.
potential outlook or rating change factors
The Stable outlook assumes that the rating will highly likely stay unchanged within the 12 to 18-month horizon.
A positive rating action may be prompted by:
-
Weighted average ratio of total debt to FFO before net interest payments falling below 2.0x;
-
Weighted average ratio of FFO before net interest payments to interest payments falling below 5.0x.
A negative rating action may be prompted by:
-
Weighted average ratio of total debt to FFO before net interest payments exceeding 3.5x;
-
Weighted average ratio of FFO before net interest payments to interest payments falling below 1.0x;
-
Loss of control by the Shareholders;
-
Lower credit ratings of the Shareholders.
RATING COMPONENTS
Standalone creditworthiness assessment (SCA): a-.
Support: taking into account the support from the supporting entities, the credit rating is equal to the rated entity’s SCA plus four notches.
REGULATORY DISCLOSURE
|
Applicable credit rating methodologies, including those used to assess the rated entity’s standalone creditworthiness and rating-sensitive external factors |
1. Methodology for Assigning Credit Ratings to Non-Financial Corporations under the National Scale for the Russian Federation to calculate the SCA and determine the credit rating and the credit rating outlook of SLAVNEFT under the national scale for the Russian Federation.
2. Methodology for Assigning Credit Ratings with External Support
to assess the factors of external influence. 3. Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities to ensure consistent and uniform application of ACRA’s methodologies, rating scales, models, and key rating assumptions. |
|
First publication date of the credit rating(s) |
August 27, 2024 |
|
Last publication date of the credit rating(s) |
August 20, 2025 |
|
Next revision of the credit rating(s) and the credit rating outlook |
Within one year from the latest rating action date. |
|
Material sources of information |
The rated entity, publicly available sources, and ACRA’s own databases. |
|
Standards and date of the latest financial statements used as a source of information in the rating action |
IFRS as of December 31, 2025 |
|
Rating solicitation |
Solicited |
|
Limitations with respect to the credit rating or the credit rating outlook, including those related to the quality of information on the rated object available to the credit rating agency |
ACRA used only information, the quality and reliability of which were, in ACRA’s opinion, appropriate and sufficient to apply the rating methodologies. No conflicts of interest were discovered in the course of the credit rating process. |
|
Ancillary services, if any, provided to the rated entity during the year preceding the rating action, and the period of these services. |
None |
