Energy Project Finance (3 - 4 days)
Learning the techniques and elements of non-recourse financing of large-scale energy projects:
1. Principles of Non-recourse Finance
- Market of project finance;
- The difference between "project finance" and "financing projects";
- the principles of project finance;
- "good" and "difficult" projects for non-recourse finance.
2. Energy Products and Projects
- Commodities and their markets: oil, gas, coal, bio fuels,power;
- Candidates for project finance: power generation, liquid natural gas (LNG) terminals, transmission lines, pipelines, refineries, primary and secondary oil & gas exploration.
3. Business Models
- Revenues: production profiles, contract types, offtake agreements;
- Pricing: auctions, markets, fixed;
- Operational costs: fixed, variable, working capital.
4. Sources and Instruments of Finance
- Funding requirements over the lifecycle of projects;
- Classes of funding;
- Financing instruments: equity, loan, bond, commodity-based lending, leasing structures, guarantees, Islamic financing structures.
- Debt instruments: repayment methods, interest calculations, credit ratios.
5. Cash Flow Model
- Using a cash flow model to analyse and structure projects including sensitivity and scenario analysis;
- Debt sizing;
- Credit decision, investment decisions;
- Re-financing debt, secondary equity sale;
6. Risk Assessment & Strategy
- Identification of risks, including credit, market, interest, infrastructure, engineering, liquidity, supply, currency, political and environmental;
- Discussing structures to allocate, finance or mitigate risk and impact on financial model.
7. Contractual and Legal Framework
- Detailed discussion of crucial contracts including loan agreement, project implementation agreement, construction contract, o&m contract, power purchase agreement, corporate documentation, land agreements and bond documentation;
- Bankruptcy of debt or equity providers;
- Anti-corruption and anti-money laundering.
8. Project Finance in Specific Energy Sectors
- Renewable energy project finance;
- Merchant power projects;
- Transmission lines;
- Nuclear power;
- Oil refineries;
- Biofuel production;
- Oil & gas exploration.