S&P rates Chesapeake notes BB+

Standard & Poor's said it assigned its BB+ rating to Chesapeake Energy Corp.'s proposed $1 billion senior unsecured notes due 2019. The recovery rating is 3, which indicates an expectation of meaningful recovery in the event of a default, the agency said.

The agency affirmed the ratings on Chesapeake and revised the outlook to negative on Feb. 6.

According to S&P, apart from its proposed debt issuance, Chesapeake announced planned funding actions in 2012 totaling $10 billion to $12 billion, in part, to fund the expected shortfall in its operating cash flow compared with planned capital spending levels.

While Chesapeake's announcements underscore the range of financing options available to the company, S&P said it believes the negative outlook remains appropriate.

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