Gas-buying plays by public-sector utilities gained some traction in their credit ratings Wednesday as Standard & Poor’s Ratings Services (S&P) raised ratings on four deals while holding the line on a fifth. S&P Tuesday raised the credit rating on Merrill Lynch & Co., which has a role in each of the deals.

Bonds totaling nearly $3 billion are involved in long-term gas purchases by financing arms of the Roseville (CA), Long Beach (CA), and Clarksville (TN) public-sector utilities, along with a group of Texas municipal utilities and Georgia public-sector utilities.

The move came a day after S&P refused to change the ratings for Roseville and Clarksville when the ratings of Wachovia Bank NA were raised (see Daily GPI, Jan. 7).

S&P upgraded the Texas Municipal/Gas Acquisition and Supply Corp.’s (TexGas I) $485 million (series 2006A), $268.5 million (2006B), and $1.323 billion ((2008D) in bonds to “A+” from “A,” removed its “CreditWatch with developing implications” designation, but kept the outlook as “negative.” It did the same thing for three other gas deals:

The ratings on Clarksville Natural Gas Acquisition Corp.’s $240.1 million in bonds (series 2006) were unaffected, said S&P.

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