Qatar Sets New Record With $12.5 Billion Bond Issuance

Qatar Petroleum has raised $12.5 billion in a four-tranche bond in the largest corporate issuance in the Middle East and the biggest debt sale in emerging markets this year.

The state company of Qatar, one of the world’s top liquefied natural gas (LNG) exporters, said on Thursday it had placed five-, 10- and 20-year conventional tranches, and a dual-listed 30-year Formosa tranche. The Formosa bond is typically issued in Taiwan, but is denominated by a currency other than the Taiwan dollar.

“This is the largest US dollar fixed rate oil and gas offering, the largest corporate issuance in the MENA region, and the largest corporate Formosa tranche raised globally,” Qatar Petroleum said in a statement.

The company plans to use the proceeds from the record bond to fund its growth plans to significantly raise gas extraction, liquefaction, and LNG export capacity this decade.

Earlier this year, Qatar Petroleum took the final investment decision to build what it says would be the world’s largest LNG project in terms of capacity, as the tiny Gulf nation and top global LNG exporter aims to raise its annual production by 40 percent by the end of 2025. Qatar Petroleum sanctioned in February the North Field East Project (NFE), which is set to raise Qatar’s LNG production capacity from 77 million tons per annum (mmtpa) to 110 mmtpa. The project, expected to start production in the fourth quarter of 2025, will cost $28.75 billion, which would make it one of the industry’s largest investments in recent years.

“The North Field expansion projects will solidify Qatar Petroleum’s leading role in the LNG industry as well as in the energy transition,” said Saad Sherida Al-Kaabi, Minister of State for Energy Affairs and President and CEO of Qatar Petroleum, commenting on the bond issue today.

Last month, another state energy giant in the Middle East, Saudi Aramco, also raised billions of U.S. dollars in a three-tranche bond sale, raising $6 billion via its first Islamic bond denominated in U.S. dollars, orders for which exceeded $60 billion.

By Tsvetana Paraskova for Oilprice.com

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