Questar Subsidiary Receives Baa2 Rating on Notes

SALT LAKE CITY — Moody's Investors Service has assigned a Baa2 Rating to $150 million in planned notes by Questar Market Resources, Inc., the unregulated energy-development subsidiary of Questar Corp. (NYSE:STR).

Moody's said the rating "reflects the quality of Market Resources' program," which includes oil and gas exploration and production, cost-of-service gas development and gathering, and processing and marketing operations. Moody's also cited Market Resources' affiliation with Questar, currently rated Prime-1 by Moody's for commercial paper.

Questar Market Resources (QMR) plans to use funds from the planned financing to replace existing debt.

Moody's noted that QMR has conducted a successful reserve acquisition and development program, with annual drilling success rates in excess of 90%. "Market Resources has a demonstrated record of low finding costs and has been successful in increasing reserves on a consistent basis, while also increasing production," Moody's noted in its report.

Recently, USBancorp Piper Jaffray issued a "Buy" recommendation on QMR's commercial paper. USBancorp said the QMR commercial paper program "represents one of the safe havens for non-rated and lower tier rated fixed-income investors in today's marketplace." USBancorp also recognized QMR's "consistent record of growing reserves and production while keeping finding costs low."

Questar is a $2.3 billion diversified natural gas company headquartered in Salt Lake City. Through subsidiaries, it engages in energy development and production; gas gathering and processing; wholesale gas, electricity and liquids trading; retail energy services; interstate gas transmission and storage; retail gas distribution; and information systems and technologies.

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