S&P revises EnQuest view to stable

S&P said it changed the outlook for EnQuest to stable from negative and affirmed the CCC+ ratings on the company and its unsecured notes.

Lower costs and the expectation of supportive oil prices have reduced default risks in the next few months. Despite S&P’s previous concerns regarding cash flow generation, EnQuest managed to cut net debt to $1.35 billion at June 30 from $1.41 billion at Dec. 31.

“The stable outlook balances our expectation of positive FOCF in 2020-2021 with EnQuest’s still-uncertain liquidity position. As the maturity of its $440 million credit facility approaches in October 2021, liquidity headroom will be under continuous pressure,” S&P said in a press release.

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