S&P rates Oryx Southern loan B+

S&P said it assigned its B+ corporate credit rating to Oryx Southern Delaware Holdings LLC. The outlook is stable.

S&P also assigned a B+ issue-level rating and 3 recovery rating to the company's $800 million term loan due 2025. The 3 recovery rating indicates that the lenders can expect meaningful (50%-70%; rounded estimate 65%) recovery in the event of payment default.

“Our B+ corporate credit rating on Oryx Southern Delaware Holdings LLC reflects our view of the company's highly leveraged financial risk profile and weak business risk profile,” S&P said in a news release.

“We expect Oryx's credit metrics to be elevated in 2018, but improve in 2019 as volumes and cash flows increase. The company's business risk profile reflects its small scale of operations, exposure to volumetric risk, and limited geographic diversity, as well as its position in the highly economic Delaware Basin.”

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