S&P pares Oryx Midstream

S&P said it downgraded the ratings on Oryx Midstream Holdings LLC and its term loan to B- from B. The recovery rating is unchanged at 3, indicating an expectation for meaningful (50%-70%; rounded estimate: 55%) recovery in the event of default.

“The downgrade follows the downward revision of our commodity price assumptions, which we expect will cause Oryx to have lower adjusted EBITDA and volume flow levels than we previously forecast. We expect the company will face a more challenging marketplace for the remainder of 2020 and 2021, as producers reevaluate their development timelines and production forecasts,” said S&P in a press release.

“We forecast that Oryx will sustain an adjusted debt-to-EBITDA ratio of about 7x over the next 12 months,” the agency said.

The outlook is negative.

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