S&P rates Osum loan B+

Standard & Poor’s said it assigned a B- long-term corporate credit rating to Osum Production Corp.

The agency also said it assigned a B- corporate credit rating to Osum’s parent company, Osum Oil Sands Corp.

S&P also said it assigned a B+ rating and 1 recovery rating to Osum Production’s proposed $210 million senior secured term loan B. The 1 recovery rating indicates 90% to 100% expected default recovery.

The outlook is stable.

The ratings reflect an expectation that Osum Production will be able to operate its one producing asset, the Orion in-situ project, in a manner consistent with the project’s previous owner such that production economics remain consistent with Orion’s recent performance, S&P said.

Although the agency has limited visibility to Orion’s historical finding and development cost profile, S&P said it assumes the company’s full-cycle costs will remain in line with the average cost structure of other producers operating in the Cold Lake region.

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