QatarEnergy’s credit quality remains “resilient” despite shipping disruption and damage to some production assets, according to Moody’s, an international credit rating agency. Its ‘Aa2’ long-term issuer ratings and ‘aa2’ Baseline Credit Assessment (BCA) are supported by very close interlinkage between QatarEnergy and Qatar government (Aa2 stable), a very strong low-cost operating profile, a robust balance sheet and a large cash buffer. “These factors have helped absorb the losses inflicted on QatarEnergy without a permanent deterioration in its credit strength,” Moody’s said. According to QatarEnergy, the damaged assets, that had cost $26bn to build, represent around 17% of its LNG (liquefied natural gas) production capacity, or about 12.8mn tonnes per annum (Mtpa). QatarEnergy said the damaged LNG trains could be offline for three to five years while the GTL (gas-to-liquid) facility may take minimum of one year to repair. Besides the partial loss of LNG supply, associated output of condensate, LPG, helium, naphtha and sulphur would also decline. “Despite the damage to production assets, QatarEnergy’s business profile remains robust, supported by the very large scale of its proved gas reserves, its large unaffected LNG production capacity of 64.2Mtpa, and the low-cost nature of its operations as one of the world’s lowest-cost gas producers, as well as strong operating efficiency,” the rating agency said. If hostilities cease and no further material damage is inflicted, Moody’s estimates that “QatarEnergy should be able to generate substantial free cash flow before dividends at around $15bn on an annual basis, which should be sufficient to absorb operating losses and additional repair-related capital spending.” QatarEnergy also has a very robust balance sheet and large cash reserves, which provide a substantial financial buffer to weather the Middle East conflict for some time without a detrimental impact on its standalone credit quality, Moody’s said.“We expect QatarEnergy’s credit metrics to remain strong, with debt/book capitalisation below 20% and debt/Ebitda (earnings before interest, taxes, depreciation and amortisation) at around 1.2x in 2026 (according to our estimates), compared with our estimates of 18% and 0.9x, respectively, for 2025,” Moody’s said.