Moody's cuts Borger Energy to junk

Moody's Investors Service said it downgraded the senior secured debt rating of Borger Energy Associates LP to Ba1 from Baa3, concluding the review for downgrade that was initiated on Nov. 1.

The outlook is negative.

Moody's said the downgrade reflects the expectation that Borger's debt service coverage ratios will remain below the level that is consistent with the Baa3 rating through 2006 and the fact that Borger is not expected to be able to fully fund its major maintenance reserve in 2004. At year-end 2004, the project's major maintenance reserve is expected to be under funded by about $400,000.

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