DBRS: Vermilion notes BB(low)

DBRS said it assigned an issuer rating of BB (low) to Vermilion Energy Inc., along with a provisional instrument rating of BB (low) with a recovery rating of RR3 to its proposed unsecured notes.

The trends are stable.

The proposed unsecured notes, estimated at $200 million and supported by subsidiary guarantees, are structurally subordinated to Vermilion's secured bank facility, DBRS said.

The proceeds will be used to pay down the bank facility, the agency said.

The ratings reflect the company's strong financial profile and diverse operations, with a considerable international presence, DBRS said.

Vermilion also benefits from lower royalties and higher netbacks in its international regions than in western Canada, where most of its peers are focused, the agency added.

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