TEHRAN Jun 12, 2007 (Dow Jones Newswires)
The managing director of Iranian state-owned Pars Oil and Gas Company, or POGC, said Tuesday that the company is planning to set up an investment fund that will issue bonds to finance development projects in the huge South Pars gas field in the Persian Gulf, the semi-official Mehr news agency reported.
Akbar Torkan said details pertaining to the fund, tentatively dubbed Pars Investment Fund, have been submitted to Iranian President Mahmoud Ahmadinejad for consideration. If the plans are approved the fund will be set up, but Torkan didn’t provide a timeframe.
Torkan said initially the fund, which would be guaranteed by POGC parent company the National Iranian Oil Company, would issue $3.5 billion of bonds paying 8percent-15percent interest.
He said it hasn’t been decided yet where the fund would be registered, adding that the most likely location is either Bahrain or Oman, adding that an international bank would operate it. But he didn’t name the bank in question.
Torkan said financing for some South Pars projects, such as phases 17 and 18, has run out and the investment fund is one way of helping Iran to raise the necessary capital for these projects.
Torkan has been calling on the government to address the financing shortage for the expansion of the South Pars gas field given that major banks in the industrial world are enforcing an unwritten code of conduct toward Iran that aims to deprive it of international capital. He has also previously asked the government to take steps toward setting up an oil-industry bank to deal with the industry’s financial needs and give POGC access to financing from the oil stabilization fund.
The United States has been campaigning to deprive Iran of capital and technology badly needed to develop its vital oil industry because of the Islamic state’s pursuit of its controversial nuclear program.
Almost half of Iran’s more than 28 trillion cubic meters of gas reserves lie in the South Pars gas field, jointly owned by Qatar.
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