Credit Impact on the Pipeline Sector from Low Oil Prices and Coronavirus Global Pandemic
DBRS Limited (DBRS Morningstar) notes that if the current depressed oil market conditions persist over the next three to four quarters with no meaningful and fundamental improvements, the credit profiles of oil and gas (O&G) companies could deteriorate materially and this could have a negative impact on credit ratings of pipeline companies.
Enbridge is an energy transportation and distribution companyoperating in 5 segments: Liquids Pipelines, consists of common carrier and contract crude oil, natural gas liquids and refined products pipelines and terminals; Gas Distribution, of Co.'s natural gas utility operations; Gas Pipelines and Processi consists of investments in natural gas pipelines and processing facilities; Green Power and Transmission, consists of Co.'s investments in renewable energy assets and transmission facilities; and Energy Services, consist of physical commodity marketing activity and logistical services.
Gibson Energy is engaged in the movement, storage, blending, processing and marketing and distribution of crude oil, condensate, natural gas liquids and refined products. Co. operates five business segments: Terminals and Pipelines, Truck Transportation, Propane and NGL Marketing and Distribution, Processing and Wellsite Fluids, and Marketing.
Key Petroleum is engaged in acquisition of petroleum permits, and the exploration of these permits with the objective of identifying economic oil and gas deposits.
Kinder Morgan is an energy infrastructure company. The company's segments are: Natural Gas Pipelines, which includes the ownership and operation of, among others, main interstate and intrastate natural gas pipeline and storage systems; Products Pipelines, which includes the refined petroleum products, crude oil and condensate pipelines; Terminals, which includes the ownership and/or operation of, among others, liquids and bulk terminal facilities; and carbon dioxide (CO2), which includes the production, transportation and marketing of CO2, ownership interests in and/or operation of oil fields and gasoline processing plants in West Texas.
TransCanada is an energy company. Co. operates three business segments: natural gas pipeline, which transports natural gas across Canada, the U.S. and Mexico, and has regulated natural gas storage facilities in Michigan with a total capacity of 250 billion cubic ft.; liquids pipelines, which consists of wholly-owned and operated crude oil pipeline systems that connects Alberta and U.S. crude oil supplies to U.S. refining markets, as well as connecting U.S. crude oil supplies from the Cushing, OK hub to refining markets in the U.S Gulf Coast; and energy, which includes a portfolio of power generation assets in Canada and the U.S., and unregulated natural gas storage assets in Alberta.
TransGlobe Energy is engaged in oil and gas exploration, development and production and the acquisition of properties within the Arab Republic of Egypt and the Republic of Yemen.
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