oil fund


SOFAZ redeem debt securities of Southern Gas Corridor JSC - Trend (01.05.14)

01 May 2014 12:27:00

SOFAZ redeem debt securities of Southern Gas Corridor JSC - Trend (01.05.14)

Baku, Azerbaijan, May 1 By Emil Ismayilov – Trend

The State Committee for Securities of Azerbaijan registered the issue prospectus of interest-bearing book-entry registered unsecured bonds of "Southern Gas Corridor" CJSC in the amount of $ 917,320,800, the Baku Stock Exchange reported.

Some 9,173,208 bonds with a nominal value of $ 100 each have been issued. The placement underwriter is "PSG-Broker" LLC.

The turnover period is 10 years, with a yield of six-month Libor +1 percent. Interest payments will be carried out every six months.

Azerbaijani President Ilham Aliyev has signed a decree on February establishing a closed joint-stock company (CJSC) for effective management of projects within the second phase of Shah Deniz gas and condensate field's development, expansion of the South Caucasus Pipeline, Trans-Anatolian Gas Pipeline (TANAP) and Trans Adriatic Pipeline (TAP). The closed joint stock company will be 51 percent state-owned and 49 percent owned by the State Oil Company of Azerbaijan.

State Oil Fund of Azerbaijan (SOFAZ) has been instructed to provide an equity financing for the CJSC, which is under direct state ownership. The funds to be provided to the CJSC for financing the equity will provide a long-term investment on return conditions.

Gas will be supplied as part of the Southern Gas Corridor - a project that will allow Europe to diversify its hydrocarbon source supply and increase energy security, while Azerbaijan continues to buy a new market in the face of Europe.

The final investment decision was made on the second phase of the Azerbaijani Shah Deniz offshore gas and condensate field's development on December 17, 2013. Some 10 billion cubic meters of gas from the field will be supplied to the European market.

The contract for development of the Shah Deniz offshore field, which has proven reserves of 1.2 trillion cubic meters of gas, was signed on June 4, 1996.

Participants in the Shah Deniz field development are the State Oil Company of Azerbaijan (SOCAR) with a share of 16.7 percent, British BP (28.8 percent), Norway's Statoil (15.5 percent), Iran's NICO (10 percent), French Total (10 percent), Russia's Lukoil (10 percent), Turkish TPAO (9 percent).