First Offering of Mazut in Energy Bourse

First Offering of Mazut in Energy BourseFirst Offering of Mazut in Energy Bourse

Mazut will be offered in the energy bourse for the first time next week through forward contracts with an interest rate of 25 percent per annum, managing director of the energy bourse announced, Shana news agency reported.

Following approval of the National Iranian Oil Company (NIOC) board of directors, mazut will be offered in the energy bourse next week, Ali Hosseini said, adding that the offering will be in two phases, wherein 5,000 billion rials ($150 million) worth of standard forward contracts will be offered in each phase.

Amin Investment Bank (AminIB) is the underwriter, and Khobregan Saham Co. is the brokerage offering the contracts for supply of 380 centistokes mazut.

The offering comes after a request by the NIOC which aims to provide required resources for its projects development.

Daily interest rate of the contracts is 23 percent. At the end of the contract's one year period, a guaranteed 25 percent interest will be paid to the holders. Each contract is per one ton of mazut; besides, the offering will be carried out in rials only.

The oil ministry plans to supply sizeable volumes of oil and petroleum products, including liquefied natural gas (LNG), in the current Iranian calendar year (started March21).

Crude will be offered at free on board (FOB) price, and buyers, including international firms, will have to pay in Iranian currency, as is the oil ministry's policy regarding the sale of oil-based commodities for trading at energy bourse.