Chemanol reported that it had received a notice from Saudi Arabian Oil Company (Aramco) that its gas prices would remain at USD0.75/mmBTU (instead of the new gas price of USD1.25/mmBTU)  until early June 2016 as the company’s initial seven-year grace period would not expire until then. Following the completion of the grace period, Chemanol will be subject to methane prices of USD1.25/mmbtu as of 5 June 2016. Consequently, Chemanol has adjusted downwards the estimated 2016 financial impact of the increase in energy prices to SAR25 million from the previous estimate of SAR30 million.   The company's BoD also recommended not paying any dividends for 2015 in line with our views that the company would not be distributing any cash back to shareholders. The company has been facing significant pressure on its balance sheet as of late from its leveraged position, an issue that has been especially magnified by losses in this weak price environment. The company has already begun to restructure its debts with debt holders, but we are still cautious on liquidity and think more restructuring is needed.   Despite the few additional months at the lower gas price, we still think that 2016 will be a difficult year for Chemanol in this price environment and do not expect the additional grace period to have a significant impact on the company’s earnings. We maintain our Sell rating on Chemanol. (Company disclosure, Ahmed Hazem Maher, Yousef Husseini)