NEW YORK (AP) -- Standard & Poor's cut its debt rating on natural gas producer Quicksilver Resources Inc. further into junk status Wednesday, citing lower earnings and production expectations.
S&P cut its corporate credit rating on Quicksilver by one level to "B-" to "B," with a negative outlook. That means S&P may cut the rating again.
Lower debt ratings make it more expensive for a company to borrow money and indicate to potential investors that it the company is more likely than a company with "investment-grade" rating of not being able to pay back bondholders.
S&P assigns a "B'' rating to those companies who are vulnerable to adverse business and economic conditions but currently have the ability to meet financial commitments.
S&P cited concerns about low prices for natural gas in its downgrade. While natural gas prices have risen since May, they are still near 10-year lows. That's causing a significant slowdown in drilling and production.
The Fort Worth, Texas, company posted a $60 million loss in the January-March quarter, hurt by a $63 million charge related to the declining value of its properties because of lower natural gas prices, and said it had cut production.
