DBRS: ConocoPhillips trend stable

DBRS said it confirmed the commercial paper rating of ConocoPhillips at R-1 with a stable trend and the long-term debt ratings of ConocoPhillips and its subsidiary Burlington Resources Inc. at A with the trends changed to stable from positive.

The change reflects the company's weaker financial profile and higher cost structure, partly driven by the debt-funded Origin Energy joint venture formed in October 2008 in a sharply lower commodity pricing environment and a global recessionary climate, according to the agency.

Despite the benefits of being the second largest refiner in the United States, the company is more exposed to the sharply declining refining margins and narrowing heavy/light crude oil pricing differentials, the agency said.

Mitigating factors include the company's proprietary coking technology and carbon upgrading capabilities, coupled with its plans over the next five years to upgrade its refining capacity to handle heavier crude oil, which should provide a competitive edge and a measure of stability over the longer term, the agency noted.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.