Iran's government has approved a plan to issue a bond worth up to 1.5 billion euros on international markets to help finance priority development projects, state broadcaster IRIB reported on Monday. The proposal was made by the Economy Ministry and Central Bank, IRIB said, without giving details. Iran has earlier announced plans to issue bonds to help fund development of its energy sector.
In a separate report on Monday, IRIB said Iran would soon issue $250 million in bonds as part of financing to help boost gasoline production at its Abadan refinery. It was not immediately clear whether it was the same planned issue.
Iran is the world's fifth-largest crude exporter but lacks sufficient refining capacity to meet its gasoline needs, leaving it potentially vulnerable to any Western sanctions targeting such trade. Iran is under US and UN sanctions over its disputed nuclear programme.
A senior Iranian energy official earlier this month said Iran planned to planned to issue bonds worth 1 billion euros for the development of the South Pars natural gas field in the Gulf. The bonds for the development of the offshore South Pars field would be offered to Iranians living abroad as well as to foreign investors, Iranian media reported in July.
Iran has picked a state bank, Bank Mellat, as lead manager for the issue. Details of the maturities of the bonds were not available. In May, an Iranian state firm said Iran planned to issue $12.3 billion of foreign currency and rial-denominated bonds over the next three years to help finance South Pars, the world's largest pure gas reservoir. Iran has increasingly turned to Asia, whose energy demand is expected to outpace that in the developed world.