Fitch downgrades QGOG

Fitch Ratings said it downgraded the ratings the oil vessel-backed financings issued by QGOG Atlantic/Alaskan Rigs Ltd. to BB from BB+.

Fitch also said it removed the rating from Rating Watch negative and assigned a negative outlook.

The downgrades reflect a change in Petrobras’ willingness to honor underlying charter- and service-agreements in the event of a performance-related breach, Fitch said, and the continued pressure on global day-rates and asset values caused by stressed oil prices and changes in worldwide supply-and-demand dynamics, the agency said.

While the Atlantic Star and Alaskan Star have historically performed well, these mid-water assets are considered less strategic than the ultra-deep water assets within Petrobras’ overall fleet and may be more vulnerable to contract termination, Fitch said.

The ratings are ultimately supported by the credit quality of Petrobras, the underlying long-term contracts, QGOG’s position as one of Petrobras’ top performing service providers and the credit quality of QGOG Constellation, the agency said.

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