Government is gearing up for another huge bond issue to raise cash to fund current expenses and service existing debt.Financial sources we spoke to said the meetings Government revealed this week it was having with potential local and international investors were to discuss the planned bond issue, which comes as no surprise given the recent budget.One source said Government wants to raise just under $300 million of 15-year bonds in an offering led by a Bermuda bank.It's expected the bank will now market the bond issue in the US and possibly Canada this week and the price will be set soon after.“The key question is what will the offering price be,” one source said. “The cost (rate of interest) is dependent upon the level of demand... if lots of investors want to buy it, then the cost goes down, if not it goes up.”In July 2010, Government raised $500 million on capital markets through a ten-year bond issue, paying a 5.6 percent rate of interest, or $28 million a year, to investors. It has a repayment date of July 2020.At the time a Finance official said the offering was six times oversubscribed and raised $500 million — $100 million more than expected, as more investors wanted to buy the bonds than the amount that was actually issued. Shadow Minister of Finance Bob Richards had said he was concerned that debt issue was too generous.And commenting on the Government meetings with investors, Mr Richards this week said the PLP Government was “deepening the debt hole it has dug”.He said Bermuda already pays approximately $115 million a year servicing its billion-dollar-plus debt, which is more than $300,000 a day.In February, financial statements issued by Auditor General revealed Government has drawn down all $200 million of a term loan it got from Butterfield Bank in May 2010. In addition, Government extended and increased overdraft facilities with both Butterfield and HSBC Bermuda, totalling some $80 million. The overdraft facilities were due to expire the end of March.The Finance Ministry issued a statement this week saying: “The Bermuda Government will be meeting domestic and international investors to provide an update on economic/fiscal developments in the Country, and also as part of its process of evaluating market conditions and potential funding opportunities to address its borrowing requirement as announced in the National Budget Statement for fiscal year 2012/2013. This press release does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities, or constitute an official confirmation of any transaction, or form the basis of any contract or commitment whatsoever.”* This story has been edited to correct a mistake. We said Government issued a $500m bond issue in 2011. It was issued in 2010.