Press Release
VIS Reaffirms Preference Share Ratings of PGP Consortium Limited
Karachi, Oct 07, 2025: VIS Credit Rating Company Limited (VIS) reaffirms the preference share ratings of PGP Consortium Limited at ‘BBB+’ (Triple B plus). Medium to long term rating of ‘BBB+’ indicates Adequate credit quality; Protection factors are reasonable and sufficient. Risk factors are considered variable if changes occur in the economy. Outlook on the assigned ratings remain ‘Stable’. Previous rating action was announced on September 10, 2024.
PGP Consortium Limited (‘PGPC’ or ‘The Company’) is a wholly owned subsidiary of Pakistan GasPort Limited (PGPL), established as a Special Purpose Vehicle (SPV) for the execution of country’s second and largest LNG terminal project awarded to PGPL by Pakistan LNG Limited (‘PLL’, formerly Pakistan LNG Terminals Ltd ‘PLTL’). The Company has a long-term Operations and Services Agreement with PLL for the availability of 600 MMSCFD LNG regassification capacity (i.e., the conversion of LNG into RLNG on a tolling basis) on a ‘take or pay’ basis, which ensures guaranteed revenues and cash flow backed by the provision of revolving Standby Letter of Credit (SBLC). The Company’s terminal is located at Mazhar point, Hafeez Island, Port Qasim.
The preference shares are structured as non-participatory instruments, lacking entitlements to ordinary dividends, rights, or bonus shares. They are redeemable at the Company's discretion, subject to the approval of the Board of Directors. Cumulative dividends are linked to KIBOR, carried forward if unpaid, and paid upon approval. Redemption is permissible through a sinking fund. Call and put options facilitate transactions between the holding company and shareholders, and a conversion swap option allows partial conversion into ordinary shares within specified conditions.
The assigned ratings reflect PGPC’s strong business risk profile, supported by its position as one of only two LNG regasification terminals in the country, making it a strategic national asset. While the LNG sector faces demand-side challenges, PGPC’s exposure is mitigated through a long-term take-or-pay capacity contract that ensures stable cash flows regardless of throughput. Currency risk is limited given the dollar-denominated nature of both revenues and costs, while long-term agreements with Pakistan LNG Limited (PLL) and BW FSRU II Pte Limited, BW Fleet Management AS and Fauji Oil Terminal and Distribution Company Limited (FOTCO), provide additional operational stability.
Meanwhile, the financial risk profile is characterized by stable topline growth, and a manageable capitalization structure (lease adjusted) which is expected to remain stable in absence of significant capex requirements. Liquidity and coverage remain adequate, with DSCR at comfortable level of 1.65x as of 9MFY25. Looking ahead, sustaining capital structure and coverages alongside improvement in liquidity indicators will remain important from ratings perspective.
For further information on this ratings announcement, please contact on 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Industrial Corporates
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf