S&P: Range Resources notes BB+

S&P said it assigned a BB+ rating with 3 recovery rating to Range Resources Corp.'s planned senior unsecured notes offering.

The 3 recovery rating indicates 50% to 70% expected default recovery.

The company is offering the new notes at par in exchange for Range's existing senior subordinated notes due 2021, 2022 and 2023, S&P said.

Range Resources will exchange the new notes for Memorial Resource Development Corp.'s senior unsecured notes due 2022 in conjunction with its acquisition of that company, the agency said.

The new notes have the same coupon and maturity as the existing notes, S&P said.

The BB+ corporate credit rating and negative outlook on Range and the BB+ ratings on its existing senior subordinated notes and senior unsecured notes are unchanged.

The notes will be reviewed following the close of Range's exchange and tender offers, S&P said.

The ratings reflect the company’s large scale of reserves and production, geographic concentration in the Marcellus shale, low operating costs, significant inventory and resource potential to support production growth, the agency said.

The ratings also consider its high exposure to natural gas prices, S&P said, and the cyclical and capital-intensive nature of the exploration and production industry.

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