S&P takes action on U.S. speculative-grade exploration & production companies

Standard & Poor’s said it has taken rating actions on 45 speculative-grade U.S. oil and gas exploration and production companies after completing a review.

The review followed the recent revision of S&P’s hydrocarbon price assumptions.

“For many of our rated issuers, the rating actions reflect our expectation for material decline in credit measures due to lower prices and production as well as liquidity risks, particularly with respect to the April 2016 revolving credit facility bank borrowing base redeterminations,” S&P said in a news release.

“We expect borrowing bases for most of our rated issuers to decline due to hedges rolling off this year, futures prices that are below many bank borrowing base prices and lack of reserve replacement as result of a decline in drilling activity in 2015.”

S&P said its rating actions also reflect the potential for possible capital restructurings or distressed exchanges given the prices at which bonds are trading.

A list of rating actions on the affected companies follows:

• Alta Mesa Holdings LP: Corporate credit rating lowered to CCC+ from B-. The outlook is negative. The CCC+ senior unsecured issue level rating was affirmed (Recovery rating of 3);

• Antero Resources Corp.: BB corporate credit rating affirmed. The outlook is stable;

• Approach Resources Inc.: Corporate credit rating lowered to CCC+ from B. The outlook is negative. The CCC senior unsecured debt rating was placed on CreditWatch negative;

• Bill Barrett Corp.: Corporate credit rating lowered to B- from B. The outlook is stable;

• Bonanza Creek Energy Inc.: Corporate credit rating lowered to B- from B. The outlook is negative;

• Breitburn Energy Partners LP: Corporate credit rating lowered to B- from B. The outlook is negative;

• Carrizo Oil & Gas Inc.: B+ corporate credit rating affirmed. The outlook was revised to negative from stable. The senior unsecured debt rating was raised to B+ from B (Recovery rating of 4);

• Clayton Williams Energy Inc.: Corporate credit rating lowered to CCC+ from B-. The outlook is negative;

• CrownRock LP: B+ corporate credit rating affirmed. The outlook is stable;

• Concho Resources Inc.: BB+ corporate credit rating affirmed. The outlook is stable;

• Denbury Resources Inc.: Corporate credit rating lowered to B from BB-. The outlook is negative;

• Diamondback Energy Inc.: B+ corporate credit rating affirmed. The outlook is stable;

• Endeavor Energy Resources LP: Corporate credit rating lowered to B- from B. The outlook is stable;

• Energen Corp.: BB corporate credit rating affirmed. The outlook is stable;

• EP Energy LLC: Corporate credit rating lowered to B from BB-. The outlook is stable;

• EV Energy Partners LP: Corporate credit rating lowered to CCC+ from B. The outlook is negative;

• Fieldwood Energy LLC: Corporate credit rating lowered to CCC from B. The outlook is negative;

• Gastar Exploration Inc.: Corporate credit rating lowered to CCC+ from B-. The outlook is negative. The senior secured notes were lowered to CCC- from CCC+ (Recovery rating of 6);

• Gulfport Energy Corp.: B+ corporate credit rating affirmed. The outlook is stable;

• Hilcorp Energy I LP: BB+ corporate credit rating affirmed. The outlook is stable;

• Jonah Energy LLC: B+ corporate credit rating affirmed. The outlook is stable;

• Kosmos Energy Ltd.: B corporate credit rating affirmed. The outlook is stable;

• Legacy Reserves LP: Corporate credit rating lowered to B- from B. The outlook is stable. The CCC+ senior unsecured note rating was placed on CreditWatch negative;

• Lonestar Resources America Inc.: B- corporate credit rating affirmed. The outlook is stable. The CCC+ senior unsecured issue-level rating was placed on CreditWatch negative;

• Matador Resources Co.: B corporate credit rating affirmed. The outlook is stable. The B- senior unsecured issue-level rating was placed on CreditWatch negative;

• MD America Energy LLC: Corporate credit rating lowered to CCC from B-. The outlook is developing The CCC senior secured issue-level rating was placed on CreditWatch developing;

• Memorial Production Partners LP: Corporate credit rating lowered to B- from B. The outlook is negative;

• Memorial Resource Development Corp. (MRD): B corporate credit rating affirmed. The outlook is positive. The BB- senior secured and B- senior unsecured debt ratings were placed on CreditWatch negative;

• Northern Oil and Gas Inc.: Corporate credit rating lowered to B- from B. The outlook is negative. The CCC+ senior unsecured issue placed on CreditWatch negative;

• Oasis Petroleum Inc.: Corporate credit rating lowered to B+ from BB-. The outlook is negative;

• PDC Energy Inc.: B+ corporate credit rating affirmed. The outlook is stable;

• QEP Resources Inc.: BB+ corporate credit rating affirmed. The outlook was revised to negative from stable;

• Range Resources Corp.: BB+ corporate credit rating affirmed. The outlook was revised to negative from stable;

• Resolute Energy Corp.: Corporate credit rating lowered to CCC from B-. The outlook is negative. The CCC senior secured issue rating was placed on CreditWatch negative;

• Rice Energy Inc.: B corporate credit rating affirmed. The outlook is stable;

• RSP Permian Inc.: B+ corporate credit rating affirmed. The outlook is stable. The senior unsecured issue rating was raised to B+ from B (Recovery rating: 4);

• Sanchez Energy Corp.: B corporate credit rating affirmed. The outlook was revised to negative from stable;

• SM Energy Co.: Corporate credit rating lowered to BB- from BB. The outlook is stable. The senior unsecured rating was lowered to B+ from BB (Recovery rating: 5);

• Stone Energy Corp.: Corporate credit rating lowered to CCC+ from B. The outlook is negative. The senior unsecured rating was lowered to CCC+ from B- (Recovery rating: 3);

• Templar Energy LLC: Corporate credit rating lowered to CCC- from B-. The outlook is negative. The CC senior secured issue rating was placed on CreditWatch negative;

• Triangle USA Petroleum Corp.: Corporate credit rating lowered to CCC from B-. The outlook is negative;

• Unit Corp.: Corporate credit rating lowered to B+ from BB-. The outlook is stable;

• Vine Oil & Gas LP: B corporate credit rating affirmed. The outlook was revised to negative from stable;

• W&T Offshore Inc.: Corporate credit rating lowered to B- from B. The outlook is negative. The B+ senior secured and CCC+ senior unsecured ratings were affirmed (Recovery Ratings: 1 and 5, respectively);

• Whiting Petroleum Corp.: Corporate credit rating lowered to B+ from BB. The outlook is negative.

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