Nogaholding, the investment arm of Bahrain’s National Oil and Gas Authority (Noga), is expected to tap the international debt capital markets with sale of Islamic bonds later this year.

The company, has already spoken to banks and is likely to raise funds in the second half of 2017, the people aware of discussions with banks have said.

“They said that they will finalise the sale once they have raised the loan, which they have,” a source said, adding that the company has indicated it is interested in a benchmark-sized transaction, which usually means a $500m or a bigger deal.

The company has been holding discussions with banks since early this year and has yet to invite pitches for formal mandates.

Earlier reports suggested that the company has approached banks to set up an international bond programme and intends to appoint a global coordinator obtain a credit rating ahead of the a potential bond issue.

Officials at Nogaholding did not reply to emails requesting comments on possible debt sale.

Nogaholding’s bond plans follow the financial close of its LNG terminal project, the first LNG receiving and regasification terminal to be developed on a public-private partnership (PPP) basis in the Middle East.

The company has raised a 20-year $741m syndicated facility from nine international and regional banks, according to a statement from Bahrain LNG, the developer and owner of the scheme which is jointly held by Nogaholding and a consortium consisting US-based Teekay LNG Partners, Kuwait’s Gulf Investment Corporation and South Korea’s Samsung C&T.

Korea Trade Insurance Corporation (K-Sure) covered commercial and political risk for nearly 80 per cent of the financing, while Standard Chartered Bank, Saudi-based Arab Petroleum Investments Corporation (Apicorp) and the Korea Development Bank acted as pathfinder banks.

Others in the syndicate are Bahrain’s Ahli United Bank, Spanish banking group Banco Santander, the Netharlands’ ING Bank as well as French entities - Crédit Agricole Corporate and Investment Bank, Natixis and Société Générale.

Bahrain LNG, which is set for completion in 2019, will have a capacity of 800 million standard cubic feet a day.

The scheme comprises a floating storage unit, an offshore LNG receiving jetty and breakwater with an adjacent regasification platform, subsea gas pipelines from the platform to shore, an onshore gas receiving facility as well as an onshore nitrogen production facility. The project is set to meet peak seasonal gas demand and industrial growth in Bahrain as well as enable the kingdom to procure internationally-traded LNG on a competitive basis.