S&P assigns Earthstone B, notes B+

S&P said it assigned a B issuer rating to Earthstone Energy Inc. and B+ issue and 2 recovery ratings to the planned $550 million of senior unsecured notes to be sold by its subsidiary Earthstone Energy Holdings LLC. The 2 recovery rating indicates substantial recovery in default.

“Earthstone's pro forma production and reserves are in line with B category peers. Pro forma for the Chisholm acquisition that closed in February 2022 and its pending Bighorn acquisition, Earthstone holds about 208,500 net acres in the Midland Basin, 38,100 net acres in the Delaware Basin, and 13,200 net acres in the Eagle Ford shale play. Earthstone's acreage is about 85% held by production and 92% operated in the Delaware basin and 99% held by production and 97% operated in the Midland basin. Production is expected to be around 60,000 barrels of oil equivalent per day (boe/d) to 70,000 boe/d in 2022, of which about 65%-70% is liquids (approximately 41% oil),” S&P said in a press release.

Earthstone intends to use the proceeds to complete its acquisition of Bighorn Permian Resources.

The outlook is stable, which mirrors the forecast the company will maintain FFO to debt above 60% and will use free cash flow for added debt reduction.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.