IRPC downgraded to Ba1

The outlook for all ratings is negative.

The rating action completes Moody's review of the company which was
placed under review for downgrade on 22 April 2013.

RATINGS RATIONALE

"The downgrade of IRPC's ratings to Ba1 was driven by the company's
continued weaker-than-expected operating performance, highly leveraged
position, weak operating margins, and long lead time before completion of
its Phoenix upgrading program in 2015-16," says Simon Wong, a Moody's
Vice President and Senior Credit Officer.

"While IRPC is committed to reduce its outstanding debt in the near to
medium term, Moody's expects retained cash flow (RCF) to adjusted debt to
stay below 5% and adjusted EBIT to interest to remain below 1x for 2013,
given the challenging operating environment and large ongoing capex
program, which are not supportive of its current rating," adds Wong, who
is also Lead Analyst for IRPC.

At end-2012, RCF to adjusted debt was 2.6%, while interest coverage was
negative, primarily because of a 60% decrease in the company's gross
refining margin to USD2.5 per barrel. Despite the marked improvement in
regional refining margins during Q1 2013, IRPC reported a smaller market
gross refining margin of USD2.4 per barrel.

IRPC is carrying out the Phoenix program which is critical for improving
the medium-to-long-term competitiveness of its refining and
petrochemical business. As a result, Moody's expects IRPC to report
negative free cash flow in 2014-2015. IRPC has approved total capex of
USD1.9 billion for 2013-2017.

IRPC plans to fund its large capex program of USD785 million in 2013,
debt prepayments and scheduled repayment through positive cash flow from
its normal operations and the extension of crude payable days from its
parent PTT Public Company Limited (Baa1 stable).

The rating also incorporates a two-notch uplift, an increase from
one-notch previously, that reflects 1) PTT's willingness to provide
additional working capital and intercompany funding support to reduce
IRPC's financial burden while carrying out the large scale Phoenix
project; and 2) the likelihood of PTT providing extraordinary credit
support in a situation of stress.

The negative outlook on the ratings reflects the pressure on IRPC's
financial profile while it executes the Phoenix project as well as the
execution risk in delivering the project on time and within budget.

IRPC's outlook could change to stable if IRPC successfully deleverages,
such that its RCF to adjusted debt rises above 10% and EBIT to interest
above 1.5-2x on a sustained basis.

A ratings upgrade would require evidence of sustainable positive operating
cash flow generation and consistent improvement in credit metrics, such
as RCF to adjusted debt above 20% and EBIT to interest above 4x on a
sustained basis.

IRPC's ratings could be downgraded if RCF to adjusted debt consistently
remains below 10% and EBIT to interest drops below 1x on a sustained
basis; and/or any material delay occurs on the execution of the Phoenix
project.

The principal methodology used in this rating was the Global Refining and
Marketing Rating Methodology published in December 2009. Please see the
Credit Policy page on www.moodys.com for a copy of this methodology.

IRPC is the second-largest oil refinery and third-largest petrochemicals
producer in Thailand. It is one of six domestic oil refiners and
suppliers of petroleum products in the country. IRPC's refinery has a
nameplate capacity of 215,000 barrels per day.

The company also produces naphtha and reformate-based petrochemicals at
the same location, and is also a leading producer of styrene and its
derivatives in Thailand. IRPC is 38.51%-owned by PTT Plc.