* Gas-rich Qatar seen as safe haven in global turmoil
* Biggest bond issue from Gulf this year
* Sale attracts orders in excess of $9 bln
* Proceeds may go for infrastructure projects
* Banker says bonds to help finance Barzan gas project
By Dinesh Nair
DUBAI, Nov 30 Qatar, the world's biggest
natural gas exporter, has raised $5 billion with its first
sovereign bond issue in two years, capitalising on investors'
appetite for safe havens as the European debt crisis
destabilises global markets.
The international bond sale, priced late on Tuesday, was the
biggest from the Gulf this year. The tiny Arab state sold $2
billion in five-year bonds at a yield of 3.184 percent, $2
billion of 10-year bonds with a yield of 4.63 percent, and $1
billion of 30-year bonds yielding 5.825 percent.
"This is a very big deal. There are very few credits in the
world today who can come in and raise $5 billion under such
choppy market conditions," said Abdul Kadir Hussain, Chief
Executive of Mashreq Capital in Dubai.
"They did pay for it but for issues of this size you have to
The sale attracted investor orders in excess of $9 billion,
according to Hussain. Another source in the fixed income markets
said the order book was $9.5 billion.
Although Qatar has not publicly announced how it will use
the bond proceeds, the country will host the 2022 World Cup and
has allocated 40 percent of its budget between now and 2016 to
"It's all about diversifying your financing options," said
Shehzad Janab, head of asset management at Dubai-based Daman
"If you keep going back to your local banks, you are
effectively tapping your own sources of capital. Access to
international capital is key and obviously, the bond route is
the preferred choice now." The international market in
syndicated loans has frozen up in recent months as Western
banks' balance sheets have been hit by the European crisis.
One Doha-based banker, who declined to be named because he
was not authorised to speak publicly, said the bond proceeds
were expected to help finance the $10.3 billion Barzan gas
project, which will supply gas to Qatar's domestic market. It is
Qatar's most expensive project since Royal Dutch Shell launched
the $19 billion Pearl gas-to-liquids plant in 2006.
Qatar's last global bond deal was a three-tranche, $7
billion issue in November 2009. Demand for debt issues from the
energy-rich Gulf region has remained strong this year, as
financial instability dents investors' appetite for bonds from
Europe and many emerging markets.
Last month, Abu Dhabi's International Petroleum Investment
Co issued a three-tranche, $3.75 billion bond which was
Bahrain, hit by political protests earlier this year,
succeeded in issuing a $750 million, seven-year Islamic bond
this month, offering a yield of 6.273 percent.
Qatar, which along with Abu Dhabi is highly rated by credit
rating agencies at AA, has largely avoided the political
upheaval that has swept the Middle East this year.
Analysts polled by Reuters in September forecast Qatar's
economy would grow 18.9 percent in 2011, slowing to 7.7 percent
in 2012 -- still an extremely fast rate by global standards --
as the country's decades-long gas expansion programme wound