Fitch rates Southwestern Energy loans BB+, B+

Fitch Ratings said it affirmed Southwestern Energy Co.’s long-term issuer default rating at B+ and unsecured debt ratings at B+ with recovery rating of RR4.

The agency also said it assigned a BB+ with recovery rating of RR1 on the company’s new secured term loan and a B+ rating with recovery rating of RR4 on its secured credit facility.

The outlook also was revised to positive from negative.

The BB+ rating on the $1.191 billion secured term loan reflects its security by substantially all assets of Southwestern Energy and all proved oil and gas properties of its subsidiaries located in the Fayetteville shale, Fitch said.

The B+ rating on the $743 million secured credit facility considers that there is currently no or very limited availability under the secured debt cap making the credit facility effectively pari passu with other unsecured debt, the agency said.

Fitch said it recognizes that availability under the secured debt cap may change over time and result in all or a portion of secured credit facility borrowings becoming secured and having priority over the other unsecured debt.

The positive outlook reflects the company’s improved liquidity position and reduced repayment and refinance risk following the recently completed transactions, the agency said.

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