Fitch Rates Enogex's Senior Notes 'BBB'; Outlook Stable

2009-11-10 21:42:02 -

Fitch Ratings has assigned a 'BBB' rating to Enogex LLC's (Enogex) $250 million 6.25% senior notes maturing March 15, 2020. Proceeds from the sale will be used to pay down short-term debt and retire maturing long-term debt in January 2010. The Rating Outlook is Stable.

The ratings reflect the moderate business risk resulting from a primarily fee-based revenue stream offset in

part by some continued commodity price exposure. While Enogex has proactively managed the downside risk associated with contracting commodity margins through hedging and shifting its processing portfolio to more fixed-fee processing from keep-whole contracts, the ratings recognize that the softness in commodity prices will pressure earnings and cash flow in 2009. Fitch believes that Enogex responded appropriately to the down cycle by significantly reducing its capital expenditures and O&M expenses. Furthermore, Enogex is a beneficiary of the continued strong drilling in the unconventional production plays and volumes are expected to grow 10% in 2009.

Fitch notes that Enogex has recorded significant improvements in its operating performance in recent years and its current credit metrics remain appropriate for the ratings category. Enogex's ratings also recognize its affiliation with OGE Energy and Fitch's belief that OGE Energy will continue to operate the business in a financially conservative manner going forward.

Enogex is engaged in natural gas gathering, processing, transportation, and storage. The system includes about 8,200 miles of pipe, six processing plants, and 24 billion cubic feet of storage capacity with operations based in Oklahoma City.

Additional information is available at ' www.fitchratings.com : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww .. '.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS : cts.businesswire.com/ct/CT?id=smartlink&url=HTTP%3A%2F%2FFIT .. .

IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE ' WWW.FITCHRATINGS.COM : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2FWWW .. '.

PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

Fitch Ratings, New YorkShalini Mahajan, CFA, 212-908-0351Peter
Molica, 212-908-0288orMedia Relations:Cindy Stoller,
212-908-0526Email: cindy.stoller@fitchratings.com : mailto:cindy.stoller@fitchratings.com