RIYADH, (Reuters) – Saudi Aramco and France’s Total are set to issue up to 3.75 billion Saudi riyals ($1 bln) in Islamic bonds, or sukuk, with final pricing expected by the end of the month, lead arrangers said on Tuesday.

The sukuk, open only to Saudi investors, will be issued by Saudi Aramco Total Refining and Petrochemical Co (SATORP) to help finance the Jubail refinery project. The company got regulatory approval for the issue in August.

“It’s up to 3.75 billion riyals. It’s been offered in Saudi riyals only to Saudi entities, could be less, but you can’t exceed 3.75 billion riyals,” Usman Sikandar, director and co-head of investment banking at Saudi Fransi Capital told Reuters at an investor presentation.

He added that the sukuk would mature about 11 years after completion of the refinery, expected in December 2013.

Deutsche Securities Saudi Arabia, Samba Capital and Saudi Fransi Capital were appointed joint lead managers and joint bookrunners for the sukuk.

“This is a very good project, it’s a secure project, the sponsors are guaranteeing this, so the risk factor is very low and it’s a good investment and there’s a lot of cash in the kingdom,” Fawwaz Nawwab, Satorp chief executive told reporters.

The total estimated cost of the refinery is $14 billion, Satorp executives said.

Bankers said final pricing for the sukuk – which will be calculated on the basis of 6-month Saudi interbank offered rate (SAIBOR) – would be released on Sept. 28.

Final allocations are due to be completed on Oct. 3, with settlement expected on Oct. 8.