S&P cuts Windsor to negative

Standard & Poor's said that it affirmed the BB+ rating on Windsor Petroleum Transport Corp.'s $239.1 million of secured term notes due Jan. 15, 2021 ($228.8 million currently outstanding) and revised the outlook to negative from stable.

The 3 recovery rating on the term note issuance indicates the expectation of a meaningful (50%-70%) recovery of principal in the event of a payment default.

The actions follow BP Shipping's termination of the bareboat charter on the British Pioneer, the agency said. Windsor is now operating the vessel in the merchant market at spot charter rates, exposing it to merchant and operating risk.

Given the volatile nature of spot charter rates and the fact that Windsor must cover daily operating costs of about $11,000 for vessels without a bareboat charter, the project may earn a negative margin on the Pioneer and need to draw on its reserve fund, the agency added.

The negative outlook reflects Windsor's exposure to volatile spot charter rates and operating risks on the British Pioneer, the agency said.

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