...MELBOURNE (Standard & Poor's) Sept. 8, 2015--Standard & Poor's Ratings Services said today that its rating and outlook on Woodside Petroleum Ltd. (###+/Stable/--) are unchanged, for now, after the company's announcement of the proposed merger with Oil Search Ltd. (unrated). We understand that Woodside expects to offer a scrip consideration to the Oil Search shareholders under a scheme of arrangement. The proposal is nonbinding and there is no certainty that it will result in a transaction. We consider the potential acquisition of Oil Search would assist in bolstering Woodside's business, introducing additional long-life gas reserves and low cost operations. These benefits should temper the exposure to Papua New Guinea, which we believe exhibits a very high country risk. Should this scheme of arrangement progress, we would need to determine the impact on Woodside's credit metrics after reviewing pro-forma statutory accounts and the resulting cash flow leverage. We note that Oil Search's...
