The ratings on natural gas pipeline company Southern Natural Gas Co. (SNG), a subsidiary of El Paso Corp., are based on the credit quality of the consolidated entity. Thus, the ratings on SNG are expected to mirror those of parent El Paso. The ratings on El Paso Corp. reflect a satisfactory business risk profile, which includes the stability of its pipelines and the progress management has made executing its restructuring plan. These strengths are somewhat offset by a historically weak exploration and production (E&P) unit, an aggressive though significantly improved financial profile, and the decreased proportion of pipeline cash flows after the ANR Pipeline sale. El Paso's financial profile improvement has come from better profitability and debt reduction after selling
