CENTENNIAL (S&P Global Ratings) July 16, 2019--S&P Global Ratings today said that Hilcorp Energy I L.P.'s (BB+/Stable/--) consolidation of Hilcorp Energy Development L.P. will increase its reserves and the scale of its operations but also raise its leverage because Hilcorp Energy Development's debt outweighs the additional cash flow generated from the consolidated assets. The transaction expands the company's basin diversity by adding reserves and production in the Rockies and additional scale to Hilcorp's position in South Texas. The added geographic diversity in Colorado and Wyoming cushions the company from potential regional disruptions to its current plays. Less constructively, the consolidation will raise the percentage of natural gas in Hilcorp's reserves and production mix, which we view as less favorable for
