Moody’s cuts Odebrecht notes

Moody's Investors Service said it downgraded Odebrecht Drilling Norbe VIII/IX Ltd.’s senior secured global notes due June 2021 to Caa3 from Caa2 and Odebrecht Offshore Drilling Finance Ltd.’s 6¾% and 6 5/8% senior secured global notes due in October 2022 downgraded to Ca from Caa3.

At the same time, the agency affirmed the Caa1 rating of QGOG Atlantic/Alaskan Rigs Ltd.’s senior secured global notes due July 2018.

All ratings remain with a negative outlook.

Moody's said its actions on the Odebrecht Offshore and Norbe VIII/IX's notes reflect primarily the significant deterioration of the liquidity of the operator, Odebrecht Oil and Gas SA (OOG; unrated), as reflected by the non-payment of scheduled interest on its 7% unsecured perpetual notes that was due on April 17.

In addition, the downgrade of Odebrecht Offshore reflects the increasing liquidity pressure that has resulted from the early termination by Petroleo Brasileiro SA – Petrobras (B3 negative) of the charter and services contracts of one of its four project vessels (ODN Tay IV), and the lack of replacement contracts since September 2015, the agency said.

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