Moody's affirms Energy Transfer

Moody's Investors Service said it affirmed the Baa3 senior unsecured note rating of Energy Transfer Partners, LP with a stable outlook, in response to the announcement that it has entered into an agreement with OGE Energy Corp. to form a new 50/50 joint-venture to be called ETP Enogex Partners LLC.

Assets contributed to the joint-venture include Energy Transfer's wholly owned Transwestern Pipeline and ETC Canyon Pipeline LLC, as well as its 50% stake in Midcontinent Express Pipeline, the agency noted.

Moody's said that its affirmation of Energy Transfer's Baa3 rating is based on the strategic benefits of the new joint venture, Energy Transfer's continued joint control over a new larger venture via its 50% GP interest, and significant expected direct leverage reduction for ETP from cash proceeds received in the tender for sizable Transwestern debt obligations and the extinguishment of other intercompany debt.

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