Iran to issue bonds worth $7bn
Tehran, November 21, 2010
Iran will issue bonds worth some 5 billion euros ($7 billion) to help finance development of its giant South Pars gas field, the semi-official Mehr news agency quoted a senior official as saying.
"Soon we will issue international bonds worth ... 5 billion euros for the development of this field that Iran shares with Qatar," Mehr quoted Ali Vakili, managing director of the Pars Oil and Gas Co (POGC), a subsidiary of the National Iranian Oil Co.
"The bonds will be issued in 500 million euros in installments," Vakili said. He did not give further details.
Oil Minister Massoud Mirkazemi said in May Iran needs investments of around $25 billion a year in its oil and gas industry and could turn into an importer of oil because of the lack of such funds.
One of the world's biggest oil and gas producers, Iran has been hit by international sanctions that have frightened away international energy companies.
In April, an official said Iran aimed to raise $12.5 billion this year by selling state assets, including two refineries. But analysts say some of these assets may end up being transferred within Iran's vast public sector.
Iranian authorities say sanctions have not had any impact on the Islamic state, which has increasingly turned to Asian companies to implement oil and gas projects.
Vakili said the financing for the development of the South Pars field would not be halted because of the sanctions.
"By the end of the current (Iranian) year (in March), Iran will be investing some $13 billion on the development of various phases of the field," he said.
Iran hopes South Pars will generate some $100 billion a year in income when fully developed.
State-owned Asian firms are less susceptible to Western pressure to stay away from the Iranian market and are eager for energy supplies from the Islamic state to feed future growth.
But they often lack the technology which Iran needs.
Washington and its European allies have applied sanctions on the basis that Iran's nuclear programme is a cover to build bombs. But Iran says it does not seek nuclear weapons. - Reuters