Abu Dhabi's International Petroleum Investment Company (IPIC) plans a dual-tranche five-year and 10-year benchmark bond issue denominated in euros, two market sources said on Tuesday.

Benchmark size is usually understood to be at least $500 million meaning IPIC will raise at least $1 billion if the deal goes ahead, under its unlimited Global medium term notes programme (GMTN).

IPIC will conclude investor roadshows in London on Tuesday against a backdrop of political upheaval in the Mena region which has raised risk premiums. Protests have spread to the Gulf region, taking place in Bahrain, Kuwait, Oman and Saudi Arabia.

'Abu Dhabi names haven't been too badly affected by the current crisis,' said one fixed income trader based in the UAE.

'But I do think European investors would demand a premium purely because it is a Middle Eastern credit. Then again, this is IPIC - petroleum is their business and at the moment, tension is only improving the price of their export commodity.'

IPIC, which has stakes in Daimler and Virgin Galactic through its majority-owned Aabar Investments, last tapped global bond markets in November with an oversubscribed $2.5 billion deal.

It increased its stake in Spanish oil company Cepsa in a $5 billion deal from France's Total earlier this month, allowing Abu Dhabi to extend its refining capacity, and is thought to be tapping debt markets to pay for it.

Fitch Ratings and Standard & Poor's both gave IPIC's potential bond issue an AA rating on Monday. Both also said it was understood the proceeds from the bond could be used to finance the Cepsa acquisition.

Arranging banks are Goldman Sachs, Banco Santander, BNP Paribas, Credit Agricole CIB, Deutsche Bank and Unicredit.-Reuters