Moody's cuts Golden State Petroleum notes

Moody's Investors Service said it downgraded Golden State Petroleum Transport Corp.'s 8.04% first preferred mortgage notes due 2019 to Baa3 from Baa2 and left the rating under review for downgrade.

The action is prompted by Chevron Transport Corpo.'s non-binding notice to Golden State Petro (IOM I-A) plc of its intent to terminate the long-term time charter of the Antares Voyager, one of two very large crude carriers in the Golden State structure that are under long-term charter hire to Chevron Transport, the agency said. The charter provides the underlying debt service on the notes.

The downgrade assumes that Chevron Transport will make irrevocable notice on Antares Voyager, while the continuing review for downgrade factors in the uncertainty over the credit quality of any potential new charter, charter rate risk in current volatile and depressed tanker markets and the increased possibility that the Phoenix Voyager could also be canceled, Moody's said.

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