TEXT-S&P release on Energy Transfer Partners LP

(The following statement was released by the rating agency)

March 26 - Standard & Poor's Ratings Services today assigned its 'BBB-' rating to Dallas, Texas-based Energy Transfer Partners L.P.'s (ETE.N: Quote, Profile, Research) (ETP) $1.5 billion senior unsecured note issuance.

The notes were issued principally to repay borrowings under the company's 364-day term loan credit facility and a portion of the amounts outstanding under its revolving credit facility.

The notes will be issued in three tranches, due 2013, 2018, and 2038. ETP had about $4.3 billion of total debt as of December 2007. The rating on ETP reflects the strong competitive position of the company's energy midstream, storage, and pipeline businesses and the stability of the company's predominantly fee-based service model.

The company's business risk profile is satisfactory, and its financial position is somewhat aggressive when viewed along with the owner of its general partner, Energy Transfer Equity L.P. (ETE; not rated). ETP's experienced and knowledgeable management team, with its track record of successful acquisitions and proficient operational capabilities, enhances company credit quality.

The ETP pipeline system serves the gas markets in southeastern Texas from hubs in the western and northern parts of the state. The purchase of Transwestern Pipeline Co. LLC, the partnership's first interstate pipeline that runs from western Texas to the California border and connects directly with ETP's Texas intrastate system, augmented the extensive in-state system.

The stable outlook on ETP reflects our expectation of continued solid operating performance and ETP's ability to successfully manage new investments, while funding its capital-spending program in a manner consistent with the rating.

"Continued growth in leverage at ETE or substantial new commitments to spend growth capital could lead to a negative outlook or rating change," noted Standard & Poor's credit analyst William Ferara.

"Rating or outlook improvement is unlikely, unless consolidated financial policies are changed and key credit metrics significantly exceed expectations," he continued.