Moody’s gives Gray Oak notes Baa3

Moody's Investors Service said it assigned a first time rating of Baa3 to Gray Oak Pipeline, LLC's planned senior unsecured notes.

"Gray Oak Pipeline is refinancing its term loan to maintain long-term debt in its capital structure," said James Wilkins, a Moody's vice president, in a press release. "The company will have ample revenue sourced from seven year contracts with minimum volume commitments and generate positive free cash flow." Most of those contracts are with investment-grade rated entities.

Gray Oak will use the proceeds to refinance its term loan that partially financed the construction of its 850-mile crude oil pipeline that commenced full service in the second quarter of 2020.

The outlook is stable.

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