Moody's assigns AL GCX, loan Ba3

Moody's Investors Service said it assigned first-time ratings to AL GCX Holdings, LLC, including a Ba3 corporate family rating, a Ba3-PD probability of default rating and a Ba3 rating to its planned $630 million secured term loan B due 2029.

“AL GCX's Ba3 CFR is supported by its highly stable cash flow underpinned by the 100% take-or-pay contracts (minimum volume commitments, MVCs) of the Gulf Coast Express pipeline that transports natural gas from the highly prolific and low-cost Permian Basin to various U.S. Gulf Coast markets. More than two-thirds of GCX's projected revenue will come from investment-grade shippers with a weighted average remaining contract life of 7.5 years and most shippers having renewal options at contract expiration in late 2029,” Moody’s said in a press release.

AL GCX will use the proceeds and a $259 million equity contribution from a fund managed by ArcLight Capital Partners LLC to buy a 25% interest in the Gulf Coast Express Pipeline.

The outlook is stable.

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