Reuters: Iran will issue bonds worth $1 billion in local and hard currency in the coming days to help finance the development of its energy sector, student news agency ISNA quoted a senior oil official as saying on Tuesday. TEHRAN, Feb 23 (Reuters) – Iran will issue bonds worth $1 billion in local and hard currency in the coming days to help finance the development of its energy sector, student news agency ISNA quoted a senior oil official as saying on Tuesday.
"We hope in the course of the coming days to issue bonds … to finance development of the country's South Pars gas field's various phases," ISNA quoted Seifollah Jashnsaz, managing director of National Iranian Oil Co., as saying.
He gave no further details.
Iran, the world's fifth-largest oil exporter, has struggled for years to find the cash and the technology to develop its energy sector as sanctions and political pressure have kept foreign firms away.
Last September, an official at Iran's Pars Oil and Gas Company (POGC) said a 1 billion-euro ($1.4 billion) bond was planned for the development of the field.
Iran said in January it planned to issue bonds worth up to 5 billion euros ($7 billion) during Iranian year starting in March 2010 to help finance development of its key energy industry.
Western firms are increasingly wary of investing in Iran, because of political instability and mounting tensions over the country's nuclear plans. Iran has increasingly shifted to Asian countries for cash and technology to develop its oil and gas fields.
"I think the bonds will be sold mainly to Middle Eastern investors and perhaps Asia. It would be possible to place an unrated issue to such investors. Even without direct sanctions in Europe, I don't think mainstream European investors would look at this while U.S. investors are prevented by sanctions," said Stuart Culverhouse, chief economist at London-based frontier market specialist Exotix.
U.S.-based rating agencies Moody's and Standard & Poor's do not rate Iranian bonds because of U.S. economic sanctions, while Fitch withdrew its ratings in 2008 after the country repaid its last outstanding Eurobond.
State-owned Asian firms are less susceptible to Western pressure not to do business with Iran and are eager for energy supplies from the Islamic state to feed future growth.
The United States and its European allies have been trying to pressure Iran to suspend its disputed nuclear programme, which the West fears is a cover to build bombs. Tehran says its atomic work is for peaceful purposes and will not be halted.
The United States, which has operated sanctions on most trade with Iran since its 1979 Islamic revolution, is pushing for a fourth round of U.N. penalties on Iran because of its failure to halt sensitive atomic work.
(Writing by Parisa Hafezi, additional reporting by Sebastian Tong in London ; editing by John Stonestreet)