S&P affirms Massey Energy

Standard & Poor's said it affirmed the BB- corporate credit and senior unsecured debt ratings of Massey Energy Co. The recovery rating on the debt remains unchanged at 3, indicating an expectation of 50% to 70% recovery in a default. All of the ratings are removed from CreditWatch, where they were placed in April with negative implications.

The outlook is negative.

The ratings reflect the review of management's estimates for the potential costs associated with the Upper Big Branch accident, S&P said, and a belief that Massey will have adequate liquidity to absorb the direct expenditures and lost cash flow.

The negative outlook reflects the risk that the current period of heightened regulatory scrutiny could hurt operating conditions such that earnings would weaken materially, the agency said.

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