El Paso Corp.’s credit ratings teeter on the edge of junk status after a downgrade by Standard & Poor’s Ratings Services on Tuesday. S&P said El Paso remains on CreditWatch with negative implications and could fall deep into junk levels if FERC sides with an administrative law judge in concluding that the company manipulated the California natural gas market.
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S&P Maintains TXU Corp.’s Ratings, Drops Euro Unit on Liquidity Pressures
TXU Europe Ltd. and its European subsidiaries was downgraded to one level above “junk” status Thursday by Standard & Poor’s Ratings Services (S&P), which may drop the TXU Corp. subsidiary below investment grade “in the very near future.” S&P’s action followed that by Moody’s Ratings Service on Wednesday and Fitch Ratings last Friday. S&P did not drop the corporation’s credit rating, however.
RRI’s Credit Cut Again by Fitch
Reliant Resources Inc. (RRI) took another hit to its credit status on Wednesday after Fitch Ratings dropped the energy merchant’s ratings once again, reflecting the agency’s growing concern over the company’s ability to successfully refinance unsecured bank debt, including a $2.9 billion bridge financing that is due in February. The financing was used to acquire Orion Power Holdings — an acquisition whose value and access to cash lately have been sharply reduced.
Moody’s to Assign Liquidity Ratings for Junk-Rated Companies
For companies whose debt level falls to “junk” status, Moody’s Investors Service plans to begin assigning “Speculative Grade Liquidity Ratings,” or SGLs, to isolate its opinion of an issuer’s liquidity risk. The ratings will specifically rate a junk-rated company’s liquidity over a 12-month period using four grades, from “very good” to “weak.”
Moody’s to Assign Liquidity Ratings for Junk-Rated Companies
For companies whose debt level falls to “junk” status, Moody’s Investor Service plans to begin assigning “Speculative Grade Liquidity Ratings,” or SGLs, to isolate its opinion of an issuer’s liquidity risk. The ratings will specifically rate a junk-rated company’s liquidity over a 12-month period using four grades, from “very good” to “weak.”
Energy Companies’ Credit Status Threatens Operations
Financial recovery in the energy industry is going to take a very long time, given that $226 billion — or more than 90% of market capitalization — was lost by the dozen major energy trading and power generation firms, a Nymex executive told a national meeting of state regulators in Portland, OR, last week.
Energy Companies’ Credit Status Threatens Operations
Financial recovery in the energy industry is going to take a very long time, given that $226 billion — or more than 90% of market capitalization — was lost by the dozen major energy trading and power generation firms, a Nymex executive on Tuesday told a national meeting of state regulators in Portland, OR.
Former Enron Employees Gain ‘Committee’ Status in Bankruptcy Court
In a victory for laid-off employees of bankrupt Enron Corp., U.S. Trustee Carolyn Schwartz informed attorneys for the Severed Enron Employees Coalition (SEEC) on Thursday that she will appoint an “official committee” to focus on their issues. The committee would have basically the same standing as the 15-member Official Committee of Unsecured Creditors set up to oversee Enron’s assets and debts, which could give the former workers a better chance of recovering benefits.
El Paso Seeks Quick FERC Guidance on Enforcement’s Bid for Probe
El Paso Natural Gas and El Paso Energy Merchant Co. have called on FERC to provide “immediate guidance” on the “record status” of the Commission enforcement section’s bid for an expanded investigation into whether the two companies conspired to drive up gas prices in Southern California.
Price Drops Continue; Largest in Rockies/Pacific Northwest
The moderately softening status quo remained in effect for the cash market Thursday. Declines of about a dime or less prevailed at most points, although double-digit moves were reported for the Rockies/Pacific Northwest region. The smallest drops of less than a nickel were concentrated at cool Northeast citygates.