S&P lowers Sandy Creek Energy loan

S&P said it downgraded Sandy Creek Energy Associates LP’s senior secured term loan to CCC- from CCC. The 3 recovery rating is unchanged, reflecting the agency’s expectation for meaningful recovery (50%-70%; rounded estimate: 65%) in the event of default.

“Despite the good recent operating performance, we believe SCEA will be unable to refinance its near-term maturity. The rating reflects our view of the challenging refinancing environment and the likelihood of a default over the next six months without some unforeseen positive development. We hold this view despite the project’s good recent operating and financial performance,” S&P said in a press release.

The outlook is negative.

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