S&P: Energy Transfer outlook negative

Standard & Poor's said it affirmed its BBB- corporate credit and senior unsecured ratings on Energy Transfer Partners LP and revised the outlook to negative from stable due to its projected reduction in 2009 EBITDA.

The agency said the reduced EBITDA guidance - which S&P views as likely to persist into at least the beginning of 2010 if gas prices, demand, Texas intrastate basis spreads and natural gas drilling in the San Juan and Permian basins remain weak - may push key credit metrics down to points that leave very little cushion for the BBB- rating.

Debt issuances in the first half of 2009 have exceeded expectations from earlier in the year. S&P said the additional debt has improved the partnership's liquidity position but strains near-term credit metrics. The agency now expects the debt-to-EBITDA ratio to be 4.6 times to 4.7 times in 2009-2010 versus its prior forecast of 4.3 times.

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