Power Project Finance
Overview
Understand the principles which create a bankable power project finance structure in terms of risk allocation and the commercial and financial structure
Project finance is widely used for large infrastructure projects including thermal and renewable power projects. The technique enables project risks to be allocated to the parties best able to manage them and facilitates the raising of long term debt without recourse to the project developer.
The correct allocation of risk through an appropriate commercial structure is the foundation of a sound financing plan and this course will develop these themes by walking through the commercial contracts and finance documentation and provide an understanding of how to determine the optimal amount of debt using cash flow and ratio analysis. Current circumstances in the African power project sector will be discussed.
Investment committees need to be sure that all risk aspects have been studied and the course will detail the key elements of the due diligence exercise. The course will also provide a guide on how to approach the debt market.
Benefits of Attending
- How a power project is structured and financed
- How to identify power project risks and mitigation strategies
- The role of the financial model and cash flow and ratio analysis
- Debt sizing techniques
- Project finance term sheets and loan documentation
- Contract documentation
- The due diligence process
- How to efficiently identify viable project prospects
- How to approach the debt market
Course Agenda
DAY 1
- Power Project Commercial Structure
- Attributes of a Bankable Project
- Project Risk Identification and Evaluation
- Case Study Exercise: Preparation of a risk matrix
DAY 2
- Risk Mitigation
- Case Study: Examples of risk mitigation in the power sector
- Introduction to the Financial Model
- Financial Plan for the Project
DAY 3
- Debt Structuring and Debt Sizing
- Case Study Exercise: Debt sizing and repayment profiling
- Project Opportunity Triage
- Case Study Exercise: Opportunity Triage
DAY 4
- Principal Commercial Project Contract – Key Features
- PPP Contract Structures
- Finance Documentation
- Case Study Exercise: Debt term sheet – bid preparation
DAY 5
- Running the Due Diligence Process
- Case Study: Lessons learned by the power projects that have not succeeded in Africa
- Restructuring and Refinancing
- Debt Raising – How to Take Your Project to Market
- Case Study Exercise: Presenting to the investment committee
Training Methodology
The course is interactive using a combination of lectures, case studies and workshop exercises. Questions and discussion are encouraged to enable delegates to gain an understanding that will be immediately useful in business. Subject to preserving confidentiality, delegates are welcome to seek solutions to live situations.
Pre-Course Questionnaire
We would like to customise the workshop based on your specific needs. Pre-Course Questionnaire will be sent prior to the workshop for analyse in advance and to be addressed during the course.
Course Certificate
Upon the successful completion of this course, you will receive a Certificate of Completion bearing the signatures from both the Course Director and the Course Organiser. This Certificate will testify your endeavour and serve towards your professional advancement.
Who Will Attend
Including but not limited to people working in:
- Power project developer, investor or financier
- Finance & accounting
- Project finance & structured finance
- Power project management
- Project analysis & development
- Commercial & legal
- Commercial services suppliers (law, insurance etc.)
- Policy makers and policy advisors dealing with energy sector financial issues
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Creating a bankable project finance structure in terms of risk allocation and the commercial and financial structure
