Tallgrass Energy, LP, a Kansas City based pipeline company with operations in Oklahoma says it’s been given an improved rating by Fitch Ratings.
Fitch assigned BBB- long-term Issuer Default and Senior Unsecured Ratings to both Tallgrass Energy Partners, LP, TGE’s subsidiary where the Tallgrass family debt is held and Rockies Express Pipeline LLC.
“We are pleased that Fitch has recognized our history and commitment to capitalize Tallgrass and REX for long-term stability and flexibility,” said Tallgrass Executive Vice President and Chief Financial Officer, Gary J. Brauchle. “During the early growth years at Tallgrass as well as the business transformation at REX, managing our entities with investment grade credit metrics has always been the goal. Today’s ratings announcement from Fitch is validation of those long-term efforts.”
In assigning BBB- ratings to both entities, Fitch noted that “TEP has taken significant steps towards mitigating” the re-contracting risk at REX and Pony Express Pipeline (Pony), “with recent projects and contractual extensions on both REX and Pony.” They also noted that “favorable oil production fundamentals” in the regions in which Tallgrass operates should allow TEP to “recontract capacity at Pony at rates that help support investment grade credit metrics.”
Tallgrass Energy operates in 11 states with transportation, storage, terminal, water, gathering and processing assets. Its system is connected to the Cushing hub as well as refineries in Ponca City, Oklahoma; El Dorado, Kansas and McPherson, Kansas.
