S&P: Cimarex outlook stable

Standard & Poor's said it revised its outlook on Cimarex Energy Co. to stable from negative and affirmed the company's BB corporate credit rating and its $350 million 7 1/8% senior notes due 2017 at BB/3.

The outlook revision reflects S&P's increased confidence that Cimarex's liquidity will be satisfactory in light of the recent announcement that it has increased the commitments under its credit facility to $800 million from $500 million while maintaining a $1 billion borrowing base. Also, the agency said additional hedge positions entered into at the end of March provide protection from further deterioration in realized natural gas prices, and S&P expects Cimarex to manage capital spending to remain within operating cash flows.

The ratings on Cimarex reflect its position as a midsize exploration and production company in the volatile oil and natural gas industry and the risks associated with its aggressive growth strategy, moderate reserve life and relatively high-cost operations, S&P said.

However, the company's moderate financial policies currently mitigate these factors, in the agency's view.

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