S&P rates Rockcliff Energy B, notes B+

S&P said it assigned Rockcliff Energy II LLC a B issuer rating and rated its upcoming $600 million of senior unsecured notes due 2029 a B+ with a 2 recovery rating. The 2 recovery rating indicates an expectation for substantial recovery (70%-90%; rounded estimate: 85%) of principal in default.

“The rating reflects the company's modest proved reserves and production, low percentage of proved developed reserves (35%), 98% natural gas concentration, and lack of geographic diversification. Additionally, it reflects its private equity ownership, somewhat offset by its transition to a financial policy that focuses on free cash flow generation instead of rapid growth,” the agency said in a press release.

Rockcliff plans to use the proceeds to repay credit facility borrowings.

The outlook is stable. “We project Rockcliff's debt to EBITDA will remain below 1x with funds from operations (FFO) to debt above 100% the next two years,” S&P said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.