S&P puts Williams on positive watch

Standard & Poor's said it placed the BBB- corporate credit rating on Williams Cos. Inc. and its operating subsidiaries Williams Partners LP, Transcontinental Gas Pipeline Co. LLC and Northwest Pipeline GP on CreditWatch with positive implications.

This action follows Williams' announcement that it intends to pursue separating its exploration and production business into a stand-alone, publicly traded company in a two-step process, S&P said.

The CreditWatch listing reflects the view that Williams' consolidated credit profile will improve following the spin-off of the exploration and production business, the agency added.

The exploration and production business is riskier than Williams' pipeline and midstream segments, due to its cash flow volatility and the significant capital requirements needed to maintain production levels and reserves, S&P said. As a result, the pro forma business profile will likely improve to strong because about two-thirds of the company's cash flows will come from relatively stable fee-based sources.

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