S&P: Pan American Energy unaffected by loan

Standard & Poor's said that Pan American Energy LLC's (local currency: B+/positive/--; foreign currency: B+/stable/--) recent signing of a $250 million loan with the International Finance Corp. through its Argentine branch, Pan American Energy LLC Sucursal Argentina, will not affect the ratings on Pan American Energy.

The loan will be fully guaranteed by Pan American Energy. The credit facility comprises a $110 million 10-year amortizing A loan granted by the International Finance Corp., a $135 million seven-year amortizing B loan provided by commercial banks, and a $15 million 11-year C loan.

Proceeds will be used to cover the company's financing needs for 2005, in light of its capital expenditures program in the exploration and production segment in Argentina.

S&P said that while the company is moderately increasing its leverage, the transaction improves its maturity schedule, and the overall effect is positive for Pan American Energy's credit quality.

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