The Pakistan Credit Rating Agency Limited
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Anam Waqas Ghayour

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PACRA Maintains Entity Ratings of Engro Elengy Terminal (Private) Limited

Rating Type Entity
(04-Jul-22 )
(06-Jul-21 )
Action Maintain Maintain
Long Term AA- AA-
Short Term A1 A1
Outlook Stable Stable
Rating Watch - -

The ratings reflects strong business profile of Engro Elengy Terminal (Private) Limited (EETPL or the Company), being the pioneer in the industry. Further, GOP's commitment to managing energy needs of the country by way of imported LNG added to its strength. Another significant factor is the financial strength and experience in the energy chain of the sponsoring companies – Engro Corporation Limited and Vopak LNG Holding B.V. The ETPL has initially planned to increase its capacity to 1000mmcfd however currently installed FSRU has usual capacity of 630mmcfd (peak hours: 680mmcfd). Thus, a sizable and recurring stream of income is ensured. Engro Elengy continues to meet its availability (~95%) - an outcome of technically sound operations and maintenance operator, Excelerate Energy (EE), is a key source of comfort in managing the plant's operations. The EETPL low business risk profile encompassing long-term energy supply contract inked with SSGC ensuring guaranteed off – take translating to stable revenues and cash flows stream, subject to adherence to agreed parameters. SSGC, the sole intermediary, has demonstrated timely payments against committed purchases despite challenges. Moreover, the company’s repayment capacity in terms of debt service would remain at a comfortable level. Going forward improvement in leverage indicators over time on account of debt repayment and internal cash generation further strengthen the financial risk profile of the EETPL. The corporate guarantee from sponsor group added further strength to the financial profile of the Company.
The ratings remain dependent on smooth operations of the terminal, and conduct of sole buyer with reference to the timely payments to Engro Elengy Terminal.

About the Entity
Engro Elengy Terminal (Private) Limited (EETPL) is a Private Limited Company, incorporated in Pakistan on January 9, 2014, specifically for the purpose of establishing and operating an LNG Terminal for the receipt, storage and re-gasification of LNG. EETPL commenced its operations on March 29, 2015, as the first-ever LNG Terminal Operator in Pakistan. The LNG Terminal of the Company is located in South Western Zone, Berth no.13, Port Qasim, Karachi. The company has leased a 600mmscfd baseload Floating Storage and Re-gasification Unit (FSRU) from Excelerate Energy (EE), who is also an operation and maintenance operator of the company. Elengy Terminal Pakistan Limited holds 100% of the shares of Engro Elengy Terminal (Pvt) Ltd. Vopak LNG Holding B.V. extended its shareholding in Elengy Terminal Pakistan Limited in CY18. Consequently, Engro Corp and Vopak LNG Holding B.V. now own 56% and 44% respectively. The board of directors (BoD) of Engro Elengy Terminal comprises three members including the CEO. Two members represent Engro Group while Mr. Jarmo Stoopman represents Vopak LNG Holding B.V. Mr. Yusuf Siddique joined Engro Elengy Terminal as CEO in April 2020. Prior to this, he has headed the Shell businesses in Tunisia and Jordan. Mr. Yusuf is an energy industry executive with about 24 years of experience leading upstream, downstream & renewables energy ventures in Shell, Eni & BP. He has a global career profile with diverse assignments in Tunisia, Jordan, Oman, Netherlands, Iran, Italy & Pakistan.

Vopak LNG Holding B.V. is an international player with sizable footprint in terminal businesses worldwide which adds strength to the business profile attributable to successful business model of Vopak LNG Holding B.V. of establishing a joint venture with local players.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.