Indicative of how insulated it has remained from the energy industry’s financial meltdown, Sempra Energy’s Southern California Gas Co. utility unit based in Los Angeles was given an A+ rating by Standard & Poor’s Wednesday for a $250 million bond re-funding offering. SoCalGas’s bonds are rated the same as S&P’s rates Sempra’s corporate credit.

Proceeds will be used to re-fund about a third of the $685 million in debt now carried by the nation’s largest natural gas distribution utility, and one of two major utilities in the Sempra group of companies, which are based in San Diego. Some of the money also will be used for working capital requirements, including what S&P’s called “building gas storage” in anticipation of the upcoming winter heating season.

“The (A+) rating reflects the consolidated credit profile of Sempra Energy’s California-based utility subsidiaries, San Diego Gas and Electric Co. and SoCalGas, as well as the company’s non-regulated operations,” said S&P’s San Francisco-based analyst, Swami Venkataraman.

Nevertheless, given Sempra’s ahead-of-schedule push to have half of its annual earnings come from nonutility operations by 2004, S&P’s said that even the ratings of the California utilities must be viewed with a “certain degree of the higher risk inherent in Sempra’s other businesses.” The outlook for SoCalGas was classed as “stable,” reflecting “consistent and predictable cash flow from utility operations.”

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