Moody's rates Trident Energy B2, notes B3

Moody's Investors Service said it assigned a B2 corporate family rating and a B2-PD probability of default rating to Trident Energy, LP. Concurrently, the agency assigned a B3 rating to the planned five-year $550 million of guaranteed senior secured notes to be issued by the company's wholly-owned subsidiary Trident Energy Finance plc.

“Trident Energy displays strong financial metrics for the B2 rating category. Pro forma for the planned refinancing, assuming (i) a $550 million-$600 million bond issuance and (ii) production volumes of 32 kboepd, Moody's expects E&P debt to average daily production to moderately rise to $18,000 -$19,600 in 2022 from $17,400 in 2021 before rapidly declining to $12,000 – 15,000 in 2023-2024 as a consequence of organic production increase,” Moody’s said in a press release.

The notes are rated B3, one notch below the B2 CFR. Although the notes rank equally with the $200 million revolver due six months before the notes' maturity in 2027, the latter, together with trade payable claims, as per Moody's loss-given default framework, would rank ahead of the notes in an enforcement scenario, the agency said.

The proceeds will be used to refinance the debt and for general corporate purposes.

The outlook is stable.

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