DUBAI (Reuters) -The United Arab Emirates federal government is expected to raise between $3 billion and $3.5 billion from its debut bond sale, which will comprise three tranches denominated in U.S. dollars, two sources close to the deal said on Monday. While the federal government has never issued bonds before, several of the seven emirates that it comprises have, most notably the capital Abu Dhabi and commerce hub Dubai. Sources told Reuters on Sunday the UAE would start marketing its inaugural bonds this week. On Monday, documents from banks leading the deal reviewed by Reuters showed the finance ministry was planning a debut sale of senior unsecured bonds with maturities of 10, 20 and 40 years, subject to market conditions. The 40-year portion will be Formosa bonds, which are debt securities sold in Taiwan by foreign borrowers and denominated in currencies other than the Taiwanese dollar. The proceeds will be used for “domestic budgetary purposes in compliance with the Public Debt Strategy”, an offering circular seen by Reuters showed. These include financing cabinet-approved infrastructure projects up to a maximum of 15% of the UAE’s direct and indirect outstanding public debt that is not denominated in dirhams. The funds will also be used to back investments by the Emirates Investment Authority, the UAE’s only federal sovereign wealth fund. The finance ministry hired a group of banks to lead the deal comprising Abu Dhabi Commercial Bank, BofA Securities, Citi, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, JPMorgan, Mashreqbank and Standard Chartered. They will hold investor calls starting on Monday. The federal budget accounts for only a fraction of consolidated state spending in the UAE and is partly funded by grants from Abu Dhabi and Dubai, which have their own budgets. Oil-rich Abu Dhabi contributed 9.3 billion dirhams ($2.53 billion) and Dubai provided 1.2 billion dirhams to 2020’s 50 billion dirhams revenues, expected to rise to 53 billion dirhams this year, an investor presentation reviewed by Reuters showed. Dino Kronfol, Franklin Templeton’s chief investment officer of global sukuk and MENA fixed income, said the UAE federal government was not very different from Abu Dhabi as a credit. “But it’s an important leap in terms of sovereign engagement in capital markets. It’s ultimately more efficient to deal with a sovereign UAE than seven emirates,” he said. The federal government has no debt, while the aggregate debt of the individual emirates is under 30% of the country’s GDP, the circular said. ($1 = 3.6726 UAE dirham) Reporting by Yousef Saba; Editing by Toby Chopra, William Maclean Our Standards: The Thomson Reuters Trust Principles.