The government is likely to wait until 2010 to return to foreign debt market and could well borrow from the World Bank or directly from commercial lenders as well as issue eurobonds, Deputy Finance Minister Dmitry Pankin said.

The country faces at least three more years of budget deficits, which will drain most of its oil wealth reserve funds. As such, it plans to borrow nearly $59 billion abroad by 2012.

But Pankin poured cold water on suggestions that it may issue its first eurobond since 2000 as soon as this year.

“For now, the plan is that the optimal time is 2010,” Pankin, who oversees debt policy and rainy day oil funds at the Finance Ministry, said in an interview.

Borrowing abroad this year would require amendments to the budget and Pankin said there were no plans to make such changes.

It would take at least two to three months for Russia to make the necessary preparations for a eurobond issue, including choosing lead managers among whom there could be a large Russian bank, he said.

The country plans to borrow about $18 billion abroad in 2010, and Pankin said $2 billion to $4 billion of that could come from the World Bank or even directly from commercial banks. Eurobonds will make up the rest. There are no plans to tap the International Monetary Fund.

If the price of Urals oil — a key export for Russia’s resource-focused economy — holds above the $55-a-barrel level factored into the 2010 budget, borrowing plans would likely be scaled back, Pankin added.

Russian companies have already been testing the water in foreign markets. Gazprom last week placed about $2.5 billion worth of euro- and dollar-denominated bonds at 8.125 percent in a heavily oversubscribed issue. “By definition, sovereign debt should be placed at better rates than those of even the most trusted corporate issuers,” Pankin said.

“If Russia entered the market now, the level of yield that is mentioned is about 350-550 basis points above the yield of U.S. Treasuries, somewhere in that range depending on the maturity. That’s about 5.5 to 7.5 percent,” he said.

Russia’s benchmark 2030 eurobond — issued in 2000 — currently yields about 7.5 percent.

The new eurobonds will likely be issued in several tranches, with maturities in the range of five to 10 years, Pankin said.

“For now it is probably more suitable for us [to borrow] in dollars, but we will see … where the rates are better, where the maturities are better,” he said.

Pankin also said Russia had not yet made any decisions on loans to Iceland and Serbia. Serbia’s request for a 1 billion euro loan is still being examined at the Finance Ministry level, while Iceland’s request is now being considered by the government.