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. Last Updated: 07/27/2016

Gazprom to Delay Bond Issue Until '98

Russian natural gas monopoly Gazprom said Tuesday it would push back a $1 billion to $3 billion convertible bond issue planned for November to the first quarter of 1998.

"RAO Gazprom announces that the planned issue of its convertible bonds, planned for November 1997, is postponed and will be held in the first quarter of 1998 if the situation on the market is favorable," a company statement said, adding that "the delay is due to instability on international financial markets."

The statement also said Gazprom expected an international audit of its gas reserves, the world's largest, to be completed by the end of this year. It gave no further information. U.S. investment bank Goldman Sachs is the lead underwriter for the planned issue.

Also Tuesday, a Novosibirsk administration official announced the postponement of a planned Eurobond as its reliance on federal subsidies appears to make it ineligible to issue foreign debt.

The 1998 draft budget of the region provides for 83.10 billion rubles ($14.08 million) in federal support, said securities department head Sergei Tsyvtsyn. The region's total deficit is 1.48 trillion rubles.

A draft law on regional Eurobonds says only regions that do not receive money from Moscow are allowed to issue Eurobonds.