NEW YORK, Sept 8 (Reuters) - Transocean Ltd's credit ratings were cut by Standard & Poor's on Wednesday due to potential liability stemming from its role in the Deepwater Horizon drilling rig the company leased to BP.
S&P cut Transocean's rating by one notch to BBB, two levels above junk ratings, and placed the company's rating on negative outlook, indicating it may cut the ratings again.
'Offshore drilling company Transocean Inc is exposed to numerous potential liabilities stemming from the Macondo well blowout and, in our view, contractual indemnifications by BP Plc could be contested in the future,' S&P said in a statement.
S&P cut Transocean's long- and short-term corporate credit ratings to BBB/A-3 from BBB-plus/A-2.
'The negative outlook reflects our view of the uncertainties surrounding the company's liability exposures and the prospects for a more challenging industry environment,' S&P said.
BP Plc played down on Wednesday its role in the rig blast that led to the world's worst offshore oil spill, seeking to share the blame with its contractors, Transocean and Halliburton.
In a report released on Wednesday, BP also defended some of its own decisions, which have been characterized by U.S. politicians as cost-saving measures that contributed to the Gulf of Mexico disaster.
BP officials said on Wednesday there was 'no indication' that Transocean tested the automatic shut off function on the blowout preventer before it was used on the Deepwater Horizon drilling rig the company leased to BP.
(Reporting by Walden Siew; Editing by Tim Dobbyn) Keywords: TRANSOCEAN RATINGS/SANDP (walden.siew@thomsonreuters.com; +1-646-223-6333; Reuters Messaging: walden.siew.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
S&P cut Transocean's rating by one notch to BBB, two levels above junk ratings, and placed the company's rating on negative outlook, indicating it may cut the ratings again.
'Offshore drilling company Transocean Inc is exposed to numerous potential liabilities stemming from the Macondo well blowout and, in our view, contractual indemnifications by BP Plc could be contested in the future,' S&P said in a statement.
S&P cut Transocean's long- and short-term corporate credit ratings to BBB/A-3 from BBB-plus/A-2.
'The negative outlook reflects our view of the uncertainties surrounding the company's liability exposures and the prospects for a more challenging industry environment,' S&P said.
BP Plc played down on Wednesday its role in the rig blast that led to the world's worst offshore oil spill, seeking to share the blame with its contractors, Transocean and Halliburton.
In a report released on Wednesday, BP also defended some of its own decisions, which have been characterized by U.S. politicians as cost-saving measures that contributed to the Gulf of Mexico disaster.
BP officials said on Wednesday there was 'no indication' that Transocean tested the automatic shut off function on the blowout preventer before it was used on the Deepwater Horizon drilling rig the company leased to BP.
(Reporting by Walden Siew; Editing by Tim Dobbyn) Keywords: TRANSOCEAN RATINGS/SANDP (walden.siew@thomsonreuters.com; +1-646-223-6333; Reuters Messaging: walden.siew.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.