Boardwalk Pipeline Partners L.P.

The stable outlook on Boardwalk Pipeline Partners L.P. reflects our expectation that its S&P Global Ratings-adjusted debt to EBITDA will remain in the 4.5x-5.0x range in both 2021 and 2022. While we expect Boardwalk to extend or re-sign its expiring contracts at lower rates, we also anticipate it will gradually expand its scale by executing on organic growth opportunities. We would lower our rating on Boardwalk if its EBITDA falls below our base-case assumption and causes its leverage to increase above 5.5x on a sustained basis. The decline in the company's EBITDA would likely occur due to some combination of lower contract renewal rates, operational stress, and counterparty issues. We could consider taking a positive rating action on Boardwalk if

...The company's contract profile is strong compared with those of its peers. Boardwalk Pipeline Partners L.P. transports most of its volumes under fixed-fee, take-or-pay style contracts with investment-grade counterparties, which effectively shields it from commodity and volumetric risk over the medium term. The company recently re-contracted many of its legacy contracts to improve the weighted average length of its contract profile, which is currently about seven years. We expect Boardwalk's leverage to remain in the 4.5x-5.0x range despite its modestly lower contract renewal rates. We expect the company's EBITDA to generally remain in the $750 million-$775 million area over the next few years while it maintains stable consolidated debt levels. In addition, we expect its capital expenditure (capex) to decline to about $330 million in 2021 and remain in the $300 million range annually for the next few years. Furthermore, given our expectation for positive free cash flow, we assume that Boardwalk...

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