DBRS ups Imperial Oil commercial paper

DBRS said it upgraded the commercial paper rating of Imperial Oil Ltd. to R-1 (high) from R-1 (middle) in line with the usual expectation for an AA (high) rated entity.

Imperial's debenture rating was confirmed at AA (high). The trend is stable.

The company's commercial paper limit has been increased to C$2 billion from C$1 billion. The commercial paper program is supported by a recently established credit facility, reducing Imperial's reliance on cash balances for liquidity as experienced in the past, the agency said.

The company has reaffirmed its substantial growth phase for the next decade, planning to invest $35 billion to C$40 billion for the period with an aim to raise oil sands production by 40% by 2014 and to double volumes by 2020, the agency added.

Imperial has sufficient financial strength enhanced by its low cost structure to support the accelerated project and other more modest expansions, while keeping credit metrics within the current rating categories, the agency noted.

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