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TEXT-S&P cuts Kodiak Oil & Gas snr unsecured rating to 'CCC+'
August 3, 2012 / 7:56 PM / in 5 years

TEXT-S&P cuts Kodiak Oil & Gas snr unsecured rating to 'CCC+'

Aug 3 - Standard & Poor's Ratings Services said today it has revised its
recovery rating on Kodiak Oil & Gas' senior unsecured debt to '6' from
'5'. The '6' recovery rating reflects our expectation for a negligible (0% to
10%) recovery for creditors in the event of a payment default. As a result, we
have lowered our rating on Kodiak's $800 million 8.125% unsecured notes to
'CCC+' from 'B-'. 

Our 'B' corporate credit rating and stable outlook are unchanged. 

The downgrade on the senior unsecured issue and revision of the recovery 
ratings reflects the lower recovery valuation following the recently announced 
$150 million increase in Kodiak's borrowing base to $375 million from $225 
million. Our recovery analysis incorporated an updated PV-10 valuation based 
on June 30, 2012, proven reserves using Standard & Poor's recovery methodology 
and stressed price deck assumptions. For the complete recovery analysis, see 
our recovery report on Kodiak, to be published after this release on 
RatingsDirect. 

RELATED RESEARCH AND CRITERIA
     -- Credit FAQ: Why Standard & Poor's Revised Its Assumptions For Recovery 
Analysis On Exploration And Production Companies, Nov. 3, 2010 
     -- Assumptions: Revised Assumptions For Assigning Recovery Ratings To The 
Debt Of U.S. Oil And Gas Exploration And Production Companies, Sept. 30, 2010

RATINGS LIST
Kodiak Oil & Gas
 Corporate credit rating          B/Stable/--

Downgraded; Recovery Rating Revised
                                  To         From
 Senior unsecured debt            CCC+       B-
  recovery rating                 6          5 

Complete ratings information is available to subscribers of RatingsDirect on 
the Global Credit Portal at www.globalcreditportal.com. All ratings affected 
by this rating action can be found on Standard & Poor's public Web site at 
www.standardandpoors.com. Use the Ratings search box located in the left 
column.

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