Fitch Ratings has downgraded two prepaid gas transactions as follows:
--SA Energy Acquisition Public Facility Corporation, gas supply revenue bonds, series 2007 to 'A' from 'A+';
--Tennessee Energy Acquisition Corporation, gas project revenue bonds, series 2006A to 'A' from 'A+'.
The rating action follows the downgrade by Fitch of the Goldman Sachs Group (GSG) to 'A' with a Stable Outlook from 'A+' on Rating Watch Negative.
The Outlook on the pre-pay transactions is Stable.
The long-term ratings and Outlooks on the above prepaid gas bonds are determined by Fitch's assessment of the weakest link in the transaction structure and the entities involved in the transaction, including GSG, the gas supplier guarantor. In each transaction, bond proceeds were used to fund the prepayment of natural gas supplies between the issuer and J. Aron & Co (the gas supplier).
WHAT COULD TRIGGER A RATING ACTION
Change in Counterparty Ratings: The long-term rating on the bonds will also continue to be determined by Fitch's assessment of the transaction structure, the role of the remaining counterparties in the structure, and their credit quality.
Additional information is available at 'www.fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.
Applicable Criteria and Related Research:
--'Criteria for Rating Prepaid Energy Transactions,' dated Aug. 15, 2011;
--'Prepay Gas Transactions: Focus on Counterparty Risk,' dated Feb. 23, 2009;
--'Tennessee Energy Acquisition Corp', dated Feb 13, 2009;
--'SA Energy Acquisition Public Facility Corporation, TX', dated June 13, 2007.
Applicable Criteria and Related Research:
Criteria for Rating Prepaid Energy Transactions
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=648406
Prepay Gas Transactions: Focus on Counterparty Risk
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=427254
Tennessee Energy Acquisition Corporation 2006A and B
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=425798
SA Energy Acquisition Public Facility Corporation, Texas
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=328952
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Fitch Ratings
Primary Analyst
Bhala Mehendale, +1-212-908-0520
Director
Fitch,
Inc.
One State Street Plaza
New York, NY 10004
or
Secondary
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Mike Murad, +1-212-908-0757
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Committee
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Dennis Pidherny, +1-212-908-0738
Senior Director
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Email: sandro.scenga@fitchratings.com
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