S&P lifts Portland Natural Gas

S&P said it raised the project finance rating on Portland Natural Gas Transmission System to BBB+ from BBB-.

The outlook is stable.

The upgrades stem from the 2015 upgrade of Bay State Gas Co., S&P said.

Bay State, a local distribution company, takes a significant amount of the gas that Portland Natural transports, the agency explained.

This was previously a constraining factor in the rating as the stand-alone credit profile of Portland Natural is BBB+, S&P said.

The operations phase stand-alone credit profile on Portland Natural reflects its stable cash flow generation due to long-term take-or-pay contracts with investment-grade counterparties that cover about 87% of capacity, the agency said.

These strengths are partially offset by the pipeline's small scale compared to peers and limited operating diversity, S&P said.

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