Fitch changes Ultra outlook

Fitch Ratings said it affirmed the ratings of Ultra Resources, Inc. and Ultra Petroleum Corp., including the long-term issuer default ratings at BB-.

The outlook was revised to negative from stable.

The agency said the negative outlook reflects risk of cash netback compression if improved unit economics from the horizontal program fail to materialize and/or basis differentials in the Rocky Mountain region fail to improve from the Fitch-assumed $0.70 per Mcf.

Fitch said that early results from Ultra's horizontal drilling program are mixed with successive wells pointing to significantly improved economics, but execution risk remains given the very limited sample size and short history to date of the horizontal development program.

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