S&P Global Ratings has upgraded its ratings on Trinidad Petroleum Holdings Ltd.
On Wednesday (June 1) S&P Global Ratings removed its ratings on Trinidad Petroleum Holdings Ltd from CreditWatch with developing implications and raised its Issuer credit rating on the company with a two notch upgrade to ‘BB’ from ‘B+’.
S&P Global also assigned a final ‘BB’ issuer credit and issue level rating to Heritage Petroleum Company Ltd (Heritage), the main operating subsidiary of TPHL.
The outlook for both TPHL and Heritage is “negative” to mirror that of the sovereign rating of T&T (BBB- / Negative / A-3).
Heritage contributes approximately 87 per cent of TPHL’s total Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and accounted for about 58 per cent of the country’s total oil production in Fiscal Year (FY) 2021.
“In May 2022, Heritage closed its US $500 million senior secured notes transaction and US $475 million new term loan which enabled it to refinance TPHL’s debt and implement a comfortable, lower cost and longer-term debt maturity schedule following the refinancing exercise,” a release from TPHL stated yesterday.
“These new debt issuances have excluded from any lien reserves, and importantly, property not required for core business operations.
“In addition, after TPHL refinanced most of its liabilities through Heritage, TPHL no longer has the administrative default that forced it to classify total liabilities as short-term,” it stated.
S&P Global also withdrew its issue-level ratings on TPHL’s 9.75 per cent senior secured notes due 2026 and 6 per cent senior unsecured senior notes due 2022 after full repayment in the recent refinancing exercise.
Chairman of TPHL and Heritage Michael Quamina commented “We are very pleased with this most recent upgrade. Against the backdrop of increased oil prices on the world market and Heritage’s plans for increased production, we look forward to maximising returns for the people of T&T.”