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Moody's rates Kodiak notes B3
Moody's Investors Service said it assigned a B3 (LGD 4, 67%) rating to Kodiak Oil & Gas Corp.'s senior unsecured notes due 2021.
The proceeds will be used to repay borrowings outstanding under Kodiak's first-lien credit agreement.
The outlook is stable.
The offering will provide additional liquidity for the funding of Kodiak's continuing development and production growth in the Bakken Shale, Moody's said.
With oil comprising more than 80% of production, Kodiak is well placed to convert high oil prices into high cash margins, the agency said, and the company's acreage in the Bakken provides Kodiak with substantial drilling potential for continued profitable growth.
While Kodiak continues to outspend internally generated cash during this growth phase, relative leverage measures are likely to improve as crude oil production climbs, Moody's added.
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