Press Release

JCR-VIS assigns Entity Rating of AAA to Oil and Gas Development Company Limited

Karachi, February 14, 2007: JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned a medium to long-term entity rating of AAA (Triple A) and short-term rating of A-1+ (A One Plus) to Oil and Gas Development Company Limited (OGDCL). The outlook on the medium to long-term rating is ‘Stable’.

The ratings primarily take into account OGDCL’s predominantly government held shareholding structure and its position as the largest exploration and production company in Pakistan with reserves constituting 31% of the country’s oil and gas reserves as at June 30, 2006. The company has a very strong financial profile in the historical absence of gearing on the balance sheet, with even the heavy expenditure required for exploration activities being comfortably met from internal cash generation with enough margin to have allowed the company to build a significant liquidity cushion over the years.

Following the corporatization of the organization in 1997, the management has been engaged in developing systems and strengthening of its human resource base in order to be able to further improve the performance of the company. Along with this, the management has also embarked on an increasingly aggressive exploration program by maximizing usage of available resources in order to increase the pace of new oil and gas discoveries in the country.

JCR-VIS will closely monitor the government’s plans regarding divestment in OGDCL, which is on the privatization list along with a number of other entities. So far, the government has opted to divest on a piece-meal basis on both the local and foreign bourses. However, any move to divest majority shareholding and/or management control, would need to be assessed for the impact on the company’s risk profile.

For further information on this rating announcement, please contact Mr. Safdar Kazi (safdar@jcrvis.com.pk / Ext: 221) or Mr. Saad Ahmed Madani (saad@jcrvis.com.pk / ext: 219) at 5671822/5671833/5680996 or fax to 5681105/5671600.



Faheem Ahmad
President & CEO

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright February 14, 2007 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.