MEXICO CITY, June 28 (Reuters) - Credit ratings agency Moody's said on Friday that Mexican power utility CFE's request for arbitration over several pipeline contracts are "credit-negative" for Mexico's IEnova and Canada's TC Energy Corp, the utility and the sector as a whole.
Moody's the said CFE's initiation of the dispute undermines market and investor confidence, adding that it could discourage future partnerships with the private sector.
IEnova IENOVA.MX , a unit of U.S.-based Sempra Energy (NYSE:SRE), says the CFE is seeking arbitration over a contract it signed in partnership with TC Energy to build a $2.5 billion pipeline from Texas to the Mexican Gulf coast port of Tuxpan.