Medco proceeds with bond issuance plan

JSX-listed oil and gas firm PT Medco Energi International Tbk. will proceed with plan to issue minimum of US$ 150 million yankee bond and was optimistic that the market will absorb the bond issue.

?I can not tell yet when the issue will be launched, but it is proceed as planned and will be launched shortly,? Sugiharto, Medco chief financial officer told reporters Thursday. Medco last month delayed bond issuance due to Iraqi war.

Medco had earlier appointed UBS Warburg and Credit Suisse First Boston as joint lead manager and joint book runner for the issue.

Sugiharto was optimistic the market will be able to absorb the bond. ?Learning from the experience of Bank Mandiri, which initially planned for $200 million and ended up with $300 million, we are optimistic that the issuance will be well received. Beside S&P assigned B+ rating on Medco, which reflects investors? confidence,? he said.

Proceed from the bond will be partly use to finance the company?s aggressive expansion program.

Sugiharto said Medco is currently in negotiation to acquire interest in 5 to 10 oil, gas blocks in Indonesia and was hoping to close the acquisition within the next few months. He also said Medco is considering to bid in the new 11 oil and gas exloration block the government is offering. (alex/godang)