S&P moves Motiva view to stable

S&P said it changed Motiva Enterprises LLC’s outlook to stable from negative and affirmed the BBB ratings on the company and its senior unsecured debt.

“We expect Motiva to generate strong cash flow in the fourth quarter of 2021 and full year 2022. However, we note that crack spreads and gross margins in the refining industry can be extremely volatile. The company's marketing & sales; supply, trading and logistics; and chemicals segments performed well even during the downturn. Chemicals performed exceptionally well in 2021. While we expect solid chemicals results in 2022, cash flows will be lower,” S&P said in a press release.

The outlook reflects an expectation that Motiva will benefit from midcycle conditions in 2022, resulting in adjusted debt to EBITDA below 2x, but cash flows are forecasted to be volatile depending on prevailing crack spreads, the agency said.

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