Iran to issue bonds worth $305 million
Tehran, June 2, 2010
Iran's state energy sector will issue bonds worth some 250 million euros (305.5 million) to help finance natural gas projects in the Gulf, the Oil Ministry website Shana reported on Wednesday.
"Iran will issue bonds worth 250 million euros at (through) Iranian banks abroad on Thursday to help development of its South Pars Gas field. It is expected to sell half of it on the first day," Shana quoted Saeed Ghaffari, an official from Iran's Bank Mellat, as saying.
Iran has said it planned to offer the bonds in four instalments of 250 million euros each over a 120-day period. It has already completed two of those planned deals.
Iran is under UN and US sanctions over its disputed nuclear work. Officials have said the main buyers of the bonds so far have been from Asian countries and neighbouring states in the Gulf.
Analysts say Iran needs funds to develop its oil and gas sector, but particularly Western companies are increasingly wary of investing in the major oil producer due to its nuclear dispute with the West.
The bonds, guaranteed by the National Iranian Oil Company and issued by its subsidiary Pars Oil and Gas Company, will have a maturity of three years and an interest rate of eight percent, Shana said.
The money raised is earmarked for the development of phases 15 to 18 of Iran's South Pars natural gas field, which contains about half of the estimated 28 trillion cubic metres of the country's gas reserves. Iran has the second biggest gas reserves in the world after Russia. – Reuters