BAKU, Azerbaijan, Feb. 4
By Elnur Baghishov - Trend:
Standard parallel salaf securities worth 2.5 trillion rials (about $59.5 million) will be offered on the Iran Energy Exchange (IRENEX) today, on Feb. 4, to finance Azar Oilfield projects, said Seyed Ali Hosseini, IRENEX managing director, Trend reports referring to Mehr news agency.
The securities are backed by light crude oil produced from the oilfield, the director noted.
Hosseini added that a total of 261,748 contracts (securities) will be put up for sale.
“So far, securities worth $126.7 trillion rials (approximately $3 billion) have been put up for sale, and this process will continue until the end of the Iranian year [March 21, 2020],” the director said.
Standard parallel salaf is an Islamic contract similar to futures, with the difference being that the contract’s total price must be paid in advance.
Salaf securities will be offered on the derivatives market of IRENEX. The move is part of the fiscal budget (March 2019-March 2020) which allows the government to issue such instruments up to $3 billion (in rials and foreign currency) to finance oil projects.
Earnings from bonds will be used to repay the principal amount plus interest of matured bonds, reimburse liabilities to banks and pay contractors.
IRENEX is a commodity exchange in Iran in which physical energy carriers (oil, gas, electricity) and commodity based securities are exchanged.