TEXT-Fitch release on Transportadora de Gas del Norte SA

(The following statement was released by the rating agency)

March 28 - Fitch Ratings has affirmed Transportadora de Gas del Norte S.A.'s (TGN.BA: Quote, Profile, Research) (TGN) long-term local and foreign currency Issuer Default Ratings (IDR) at 'B'.

Fitch has also affirmed the 'B' rating of TGN's senior unsecured notes due in 2012, as well as the 'RR4' recovery rating of the notes.

In conjunction with this rating action, Fitch has affirmed TGN's national scale rating of 'A-(arg)'.

The Rating Outlook for all ratings has been revised to Negative from Stable.

The revision in the Rating Outlook to Negative reflects heightened counterparty payment and legal risks due to the decision during February 2008 by the Chilean energy generator, Electrica de Santiago S.A. (ESSA), to seek legal actions in an attempt to discontinue payments to TGN in accordance with the Gas Transportation Agreement (GTA) between the two companies.

Exports of gas are important to TGN's credit profile, as they represent 44% of revenues and provide the company with hard currency.

TGN's export revenues are highly concentrated and ESSA is one of TGN's six clients outside Argentina. Fitch estimates that the ESSA contract represents US$9 million or 6% of TGN's total revenues and US$7.5 million or 7% of EBITDA.

The loss of these revenues and cash flow, should a legal decision go against TGN, is manageable.