Moody's Reviewing Canadian Oil-Producer Ratings After Price Dropby
Suncor and Encana among oil and gas companies under review
Weak industry fundamentals and lower price driving action
Moody’s Investors Service is reviewing the credit rating of seven Canadian exploration and production companies and their rated subsidiaries, including Suncor Energy Inc. and Encana Corp., for downgrade after the price of crude oil weakened further.
The companies with ratings up for review include Encana and its subsidiary Alberta Energy Company Ltd., Canadian Oil Sands Ltd. and its subsidiary Athabasca Oil Sands Investments Inc., Baytex Energy Corp., Canadian Natural Resources Ltd., Cenovus Energy Inc., Husky Energy Inc., and Suncor. Moody’s revised its oil and gas price assumptions on Dec. 15.
"Industry conditions have weakened further with oil and natural gas prices at multi-year lows," said Terry Marshall, Moody’s senior vice president, in a statement. "E&P companies will be stressed for a longer period with much lower cash flows, difficulty selling assets and limited capital markets access."