S&P drops DCP Midstream CCR to BBB-

Standard & Poor's said it lowered DCP Midstream LLC's BBB- corporate credit rating to BB and the A-3 short-term rating to B.

The outlook is negative.

The issue-level rating on Midstream's senior unsecured notes is BB. The agency is assigning a 4 recovery rating, indicating an expectation for average (30% to 50%) recovery in the upper half of the range if a payment default occurs.

The issue-level rating on Midstream's junior subordinated notes is B+ and S&P is assigning a 6 recovery rating, which indicates an expectation for negligible (0% to 10%) recovery if a payment default occurs.

At the same time, the agency lowered its BBB- corporate credit rating on master limited partnership DCP Midstream Partners LP (Partners) to BB and the A-3 short-term rating to B.

The outlook is negative.

The issue-level rating on Partners' senior unsecured notes is BB. S&P is assigning a 3 recovery rating, indicating an expectation for meaningful (50% to 70%) recovery in the upper half of the range if a payment default occurs.

S&P said the downgrade on Midstream stems from the anticipated impact that weak commodity prices will have on consolidated financial measures. The agency considers the creditworthiness of Partners to be closely tied to that of Midstream, and lowered its ratings in conjunction with those on Midstream.

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