DBRS Changes Trend on Senior Secured Notes Issued by SBM Deep Panuke S.A. to Negative from Stable

DBRS Limited (DBRS) has today changed the trend on the BBB (low) rating of the 3.50% Senior Secured Notes due 2021 (the Notes) issued by SBM Deep Panuke S.A. (the Issuer) to Negative from Stable.

The reason for the trend change on the Notes is today’s trend change on Encana Corporation’s (Encana) Issuer Rating to Negative from Stable. Encana is the lessee of the Deep Panuke Production Facility Centre (the Platform) under a Charter Agreement that extends beyond the full amortization period of the Notes.

Encana is responsible for paying a fixed lease rate to the Issuer for use of the Platform. If Encana elects to terminate the Charter Agreement, it must pay a Termination Fee which, together with the proceeds of the Debt Service Reserve Account and other cash balances of the Issuer, would be sufficient to fully repay the Notes. The rating on the Notes is therefore strongly influenced by Encana’s ratings.

Notes:
The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodology is Rating Project Finance (August 2015), which can be found on our website under Methodologies.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.