BAKU, Azerbaijan, December 11. Fitch Ratings
has flagged significant uncertainties in Naftogaz’s gas production
and financial outlook for 2025, amid escalating attacks on
Ukraine’s gas infrastructure, Trend reports via Fitch.
“Gas production continues, although Naftogaz does not disclose
the share of non-operational assets,” Fitch said. The company plans
to increase the share of natural gas purchased on the market from
11% in 2024 to 33% in 2025, reflecting the impact of infrastructure
damage and limited domestic production.
Fitch noted that forecasts for 2025 remain highly uncertain,
driven by Naftogaz’s production capabilities and actual demand.
“Operating metrics as well as the financial profile are expected to
be far weaker in 2025 than in 2024,” the agency added, highlighting
the risks from attacks targeting Naftogaz’s offtakers as well as
its own assets.
The escalation comes after Ukraine chose not to renew its gas
transit agreement with Gazprom past 2024, prompting Russia to
intensify strikes on Ukrainian gas infrastructure. The attacks have
caused significant damage to Naftogaz assets, forcing the company
to greatly increase gas imports, financed through cash reserves,
loans, and grants.
Despite these challenges, Naftogaz has made timely debt payments
in 2025. However, Fitch emphasized the company faces a large
principal repayment of EUR689 million in July 2026, which could
further strain its financial position. The ability to service debt
will depend in part on whether additional Russian attacks disrupt
production capacity.
Fitch also highlighted the potential need for another
restructuring of bonds maturing in 2026 due to elevated funding
requirements for gas purchases, noting that this is already
factored into the company’s rating.
“Naftogaz remains under significant operational and financial
pressure, and continued security risks represent a substantial
challenge to both its production and debt repayment capacity,”
Fitch concluded.
