LONDON, May 3 (Reuters) - UK-based BG Group said it would review all Argentine bidders’ creditworthiness before selling them gas, after the nationalisation of energy company YPF raised the risks of doing business there.
Despite its huge oil and gas reserves, Argentina is reliant on imported liquefied natural gas (LNG) to meet its energy needs, but credit ratings agency Moody’s said the seizure of a 51 percent stake in YPF from Spain’s Repsol announced last month made Argentina a more risky place to do business.
Moody’s cut its rating on YPF, which will take over responsibility for LNG imports from state-owned energy group Enarsa, a ruling party lawmaker said late last month.
“We are committing to Argentina supply on a case-by-case basis ... Clearly the creditworthiness of these particular companies (LNG importers) will determine the commercial terms upon which we are prepared to trade,” BG Chief Executive Frank Chapman told reporters on a conference call.
He added that BG sold two cargoes to Argentina in the first quarter of the year.
Any reduction in cargoes would hit Argentina hard as it is already struggling to secure the 80 cargos it has estimated it will need this year, due to high prices.
Adding to the problem, Spain’s Repsol may halt the delivery of nine ships carrying LNG to Argentina in retaliation for the move on its stake in YPF, a source in the energy sector said on Wednesday.