S&P rates Kodiak notes B-

Standard & Poor's said it affirmed the B- senior unsecured debt issue rating on Kodiak Oil & Gas Corp. and assigned a B- rating to the company's proposed $300 million senior unsecured notes due 2021.

The senior unsecured recovery rating is 5, indicating 10% to 30% expected recovery in a default.

The B corporate credit rating on Kodiak and positive outlook are unaffected.

The proceeds will be used to refinance borrowings under its credit facility, S&P said.

The ratings reflect its aggressive financial risk profile, vulnerable business risk profile and adequate liquidity assessment, the agency said.

These assessments reflect the company's relatively small asset base and production levels, lack of geographical diversification and high spending levels in excess of projected operating cash flows, S&P said.

The ratings also consider its significant exposure to strong crude oil prices, favorable cost structure and solid resource play acreage position, the agency said.

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