S&P provides BB to Consol Energy notes

Standard & Poor's said it assigned its BB issue-level rating (the same as the corporate credit rating) to Consol Energy Inc.'s proposed $650 million senior unsecured notes due 2023.

The recovery rating is 3, which indicates an expectation for meaningful (50% to 70%; upper end of the range) recovery in the event of a payment default.

Proceeds will be used to refinance of all of the existing 8¼% senior notes due 2020 and all or a portion of the 6 3/8% senior notes due 2021.

The corporate credit rating remains BB with a stable outlook.

S&P said the ratings reflect its view of Consol Energy’s business risk profile as "fair" and financial risk profile as "significant." The agency estimates that debt to EBITDA will average less than 4 times during the next few years and the company will maintain adequate levels of liquidity.

Consol recently announced its intention to pursue initial public offerings for its thermal and metallurgical coal operations. The extent to which these transactions may affect Consol’s ratings is unclear at this time. S&P will revisit its analysis and ratings as details emerge.

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