Ratings agency Fitch believes that Chilean energy companies will likely be able to absorb losses resulting from the earthquake and tsunami that hit the central-south region of Chile on February 27.
 
Industry profitability ratios, however, may be moderately affected during the next few quarters, the ratings agency said in a research note.
 
Based on market participants' data, the power distribution sector suffered material damages in the epicenter area while the generation and transmission sectors were affected to a lesser extent, according to the research note.
 
Fitch's expects a vast majority of damage to generation and transmission assets to be borne by insurance companies, but the economic magnitude of repair costs is yet uncertain. In the distribution sector, a greater portion of repair costs will most likely be borne by each company as some assets such as electric posts and cables that were destroyed are not generally insured by industry players.
 
Fuel supply for thermal generators does not initially seem to be at risk, as most generators have sufficient stock of coal for the next several weeks, according to Fitch.
 
To read the full report, including a summary of the effects of the earthquake on rated Chilean energy companies, in Spanish, go to this link