Enterprise Products Partners L.P.

The stable outlook reflects our expectation that EPD will maintain a strong competitive position and solid credit measures despite the uncertain economic and weak commodity price environment. We expect the partnership to maintain adjusted debt to EBITDA of about 3.5x and distribution coverage above 1.5x in 2020 and 2021. We expect the partnership will continue to self-fund the equity portion of growth capital spending. We believe EPD could look to reduce capital spending over the next 12 months on projects that may no longer meet return hurdles. We also expect the partnership to opportunistically use its new multiyear $2 billion common unit buyback program. We could consider a negative rating action if debt to EBITDA rises above 4.25x on a

...EPD's robust capital spending continues to drive EBITDA growth. EPD has had a relatively large capital spending budget for 2020. Total capital investments were $4.5 billion in 2019, with major growth projects like the Orla III gas plant, Shin Oak Pipeline, Midland-to-ECHO 2 pipeline, Mentone gas plant, Isobutane Dehydrogenation (iBDH) Plant, and the ethylene export terminal being placed in service. In 2020, we expect the partnership's capital spending budget to be $3.4 billion to $4.4 billion, of which approximately $400 million is sustaining capital expenditures. The company has focused a significant portion of the 2020 capital spending program on the growth of its crude oil pipeline and petrochemicals segments. However, we believe the company could look to scale back discretionary capital spending in 2020 and 2021 given the recent decline in commodity prices and economic uncertainty. With much of the build-out of midstream infrastructure completed over the past few years and upstream...

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