Project Finance

Corporate finance and project finance are both used by corporations for the financing of projects. They both draws on debt and equity as source of finance. While corporate finance favors higher percentage of equity project finance favors higher percentage of debt. Corporate finance which requires lower capital cost is usually used for interrelated projects of different degrees as such the performance of the corporation as  well as overall balance sheet is the basis for credit evaluation. Project finance on the other hand is focused on a single particular project that is to be constructed or in few instances the expansion of an existing project, the financing is based on the projected future revenue of the project, cost of capital is higher and the  outlay is usually very high. While risk is less in project finance as it's diversified, risk is higher in corporate finance as it's not diversified.

Two  successful projects run well in Singapore, Tuas and SingSpring. Active partnership by the governments helped equitable risk sharing and set suitable contractual agreements (off-take, flexible tariff and reliable energy supply) for this desalination project

Investors always seek guarantees before financing any desalination project, which are described as demand attributes. Whereas the government role is essential to take care of the supply attributes. This includes tools, techniques, legal and contractual structure with political environment.  If any of the supply or demand attributes are missing then this will lead to project failure.

Debt financing involves borrowing money that would be refunded over a period normally with interest. Secured borrowings involves the borrower allowing the lender an interest in specific assets (fixed charge) or all assets (floating charge) which are not specified. The aim of this paper is to briefly examine the evolution and development of floating charges in the UK and its advancement with the use of Case-Law

Solar power plant investors expect photovoltaic (PV) modules to safely and efficiently produce electricity for 25 years. International certification standards such as IEC are designed to evaluate modules for defects and design flaws that contribute to product safety or early lifetime performance issues. This certification testing is performed on a small number of preproduction panels. The majority of solar panel issues observed in the field, however, are driven by deviations in the manufacturing process, not by fundamental design flaws. These off-specification manufacturing defects are typically latent. This means that the panels initially meet performance expectations, but suffer accelerated performance degradation. Accurate data on the percentage of panels that exhibit significant latent defects is hard to come-by, but several studies suggest that the industry rate is around 4%. The appearance of latent defects significantly increases operating costs for the installation. The ability to gain knowledge of the exact quality of the PV panels installed at a power plant provides opportunity for improved output predictability and investor confidence. This knowledge will be increasingly important as the market penetration of PV increases, especially considering the more than 600 module suppliers. There is currently no certification to insure against PV panel underperformance caused by latent defects. In this article we introduce the concept of latent defect screening for PV modules. Latent defect screening involves the random sampling and accelerated-life testing of the PV panels to be installed at the construction site. We find that for an additional system cost of 1 penny per watt, we can be 95% sure that there are fewer than 3% defects in a 20MW installation.

In a white paper to the parliament the Norwegian Ministry of Culture and Church Affairs in 2004 noted that while many of the recent national films could show a healthy return on its private capital of more than 50 percent there seemed to be a notable lack of participation from the traditional investment community in the financing of these films. This report explores the economic reasons for the lack of involvement applying a project financing perspective.

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Healthcare infrastructures are a typical risky investment, which can be financed in many different and competing ways, and Public Private Partnership and project financing techniques are increasingly recognized as a useful and appropriate device. Risk identification, transfer, sharing and management are a key point of the whole structure and the risk matrix, used in order to classify and-wherever possible-measure risk is an unavoidable part of the investment package. To the extent that it can be professionally managed by specialized agents, risk sharing or transmission is not a zero sum game, even if risk pricing is never a trivial issue. While the public part traditionally bears core market risk (demand for health services), other key risks, such as those related to construction and management of commercial (hot) activities, are typically transferred to the private part, often represented by a private entity. A corporate finance perspective is crucial for preparing a proper business model, where economic and financial flows are projected along the time span of the investment, with managerial and strategic insights for not ephemeral sustainability. Capital structure issues, rotating around (optimal) leverage, are eventually discussed, starting from a Modigliani & Miller framework, with practical insights and sensitivity analyses.

This report is a risk analysis on the paper titled ‘Renewable energy project: Project Management,
challenges and risk’ written by H.H. Goh et al. This paper was written by academics at University
Tun Hussein Onn and University Malaysia Sabah. This paper was made available on line through
Elsevier journal homepage on 26th July 2014.

There are three key issues that should be addressed in the subject of pecunia traiecticia. First of all, a question whether the Roman concept of sea loan survived in the centuries following the Roman Empire. Secondly, did it inspire any other legal solution in the Western legal tradition? Finally, can one expect that pecunia traiecticia will return in the future? Answering these can help to find out whether the Roman concept of sea loan is applicable nowadays. The hypothetical revival of an ancient solution is more plausible thanks to the idea of Project Finance and the ongoing process of the decodification of private law.

A supply of dwellings greater than the demand, a reduction in the availability of housing loans and increased credit risk, caused, inter alia, by the financial crisis: these are the basic features of today's residential property and commercial premises markets in Croatia today. Built but unsold housing units have exposed private investors, who have organised the supply of units within the balance sheet of their firms, to significant risk of underinvestment. The materialisation of this risk is most manifested in the impossibility of funding the core business because of loans that they have agreed on for the construction of dwelling units meant for sale on the market. The paper then proposes a model that, if it were applied, could insure investors to a greater extent against the risk of underinvestment. The supply of dwelling units with protected rentals by the local public sector organised in the traditional manner, i.e. according to a model in which the local public sector figur...

This article examines five common misunderstandings about case-study research: (a) theoretical knowledge is more valuable than practical knowledge; (b) one cannot generalize from a single case, therefore, the single-case study cannot contribute to scientific development; (c) the case study is most useful for generating hypotheses, whereas other methods are more suitable for hypotheses testing and theory building; (d) the case study contains a bias toward verification; and (e) it is often difficult to summarize specific case studies. This article explains and corrects these misunderstandings one by one and concludes with the Kuhnian insight that a scientific discipline without a large number of thoroughly executed case studies is a discipline without systematic production of exemplars, and a discipline without exemplars is an ineffective one. Social science may be strengthened by the execution of a greater number of good case studies.

This thesis aims to analyse the role and the importance of the insurance policies in structured finance deals such as Project Finance and Project Bond in respect of the construction and operation of ships, energy and oil & gas projects, in accordance with the common law, marine and energy insurance, ship finance aspects and international market practice.

The tripartite between bank, shipowner and insurer not only provides integrated mechanism to transfer certain risks in case of an insured event but will also enable an additional and qualified diligence to be peformed by all parties involved.

Further, as will be presented, the history of insurance is intrinsically connected to the maritime adventures' history. The development of the maritime business is also directly related with the availability of credit by the market, from banks and investors, who also expects to protect as much as possible the borrowed amounts or capital invested.

The thesis also provides a synoptic overview of the main concerns from the banks and shipowner’s perspective regarding the risks involved and the insurances that are usually contracted, or should be considered, with the objective to optimize the bankability of a project and the deal. Notwithstanding the fact that eliminating all the risks is certainly not possible or feasible, banks and shipowners do have the option to transfer part of the risks to the insurance market, reducing significantly some exposures which will impact in a positive way the ship financing costs, in addition to avoid potential litigations between the parties.

The article is devoted to theoretical and practical aspects of the participation of foreign companies in the Russian PPP projects. The author analyzes the attractiveness of  the Russian PPP market for foreign investors and companies-subcontractors. The article discusses possible forms of foreign participation in PPP projects and describes the experience of foreign participation in PPP projects in the Russian Federation (in the field of transport infrastructure).
The author identified the main barriers to entry in the PPP market and the major risks of foreign participants in the project, as well as the main directions of activity of the Russian authorities and business - to improve the attractiveness of PPP projects for the community of foreign partners.

The recent free fall of oil prices and the regulatory developments within the energy markets have had major effects on investment decision and developments of the LNG facilities. This paper tries to identify how Banks manage and mitigate the various risks involved such as price and volume risks associated with project financing of the LNG vessels. The paper also highlight the potential for alternative funding and specifically the role of export credit agencies in project financing of the LNG vessels.

Managing innovation initiatives requires making structured decisions in environments of uncertainty and complexity. Palisade DecisionTools offers an integrated platform for quantifying risks / opportunities, gaining analytical insights, optimizing strategy, and guiding decisions. 2 Speaker Background Education • PhD (ABD) Nyenrode • MBA Erasmus RSM • MA Financial Management Erasmus RSM • Certificate Finance

Phronetic organizational research is an approach to the study of management and organizations focusing on ethics and power. It is based on a contemporary interpretation of the Aristotelian concept phronesis, usually as ‘prudence’. Phronesis is the ability to think and act in relation to values, to deliberate about ‘things that are good or bad for humans’ in the words of Aristotle (1976:1140a24–b12). Phronetic organizational research effectively provides answers to the following four value-rational questions, for specific problematics in management and organization studies: 1. Where are we going with this specific management problematic? 2. Who gains and who loses, and by which mechanisms of power? 3. Is this development desirable? 4. What, if anything, should we do about it?

The Aalborg Project may be interpreted as a metaphor of modern politics, modern administration and planning, and of modernity itself. The basic idea of the project was comprehensive, coherent, and innovative, and it was based on rational and democratic argument. During implementation, however, when idea met reality, the play of Machiavellian princes, Nietzschean will to power, and Foucauldian rationality-as-rationalization resulted in the fragmentation of the project.

Project size, as measured by the amount of investment required, is a relevant parameter to be used in project selection. The evaluation of a project portfolio must consider the variety of project sizes that may be met, so that a proper model should be adopted to describe that variety, especially for its use in simulation. In this paper, a log-normal probability model is suggested to describe the dispersion of project sizes within a project portfolio. The model is obtained on the basis of two real datasets spanning over ten years of observations, and after comparison with competing Gamma and Pareto models. The parameters of the log-normal model are provided as resulting from the best-fit procedure, and indications are also given for the values to use in a simulation study.

At the same time that case studies are widely used and have produced canonical texts, it may be observed that the case study as a methodology is generally held in low regard, or is simply ignored, within the academy. For example, only 2 of the 30 top-ranked U.S. graduate programs in political science require a dedicated graduate course in case study or qualitative methods, and a full third of these programs do not even offer such a course. In contrast, all of the top 30 programs offer courses in quantitative methods and almost all of them require training in such methods, often several courses. In identifying this paradox of the case study’s wide use and low regard, Gerring rightly remarks that the case study survives in a “curious methodological limbo,” and that the reason is that the method is poorly understood. In what follows, we will try to resolve Gerring’s paradox and help case study research gain wider use and acceptance.

In recent times, talks and initiatives on CSR have widely been accepted by many businesses as part of their agenda and schedules for profit maximization. The oil and gas industry in particular has adopted these varied initiatives because of its importance and the impacts it has to the industry. Although some authors arguably believe that CSR has little or no impacts at all on the buying behaviors of consumers, this research delved deeply into this with the hope of finding out why such assertions and how true they might be and found out that, although the issue of CSR has its own limitations and challenges, it does impact greatly on the buying behaviors of consumers in the retail sector of the oil and gas industry. Rapid technological advancement and the ease with which information is received have led to the spread of information regarding companies’ CSR engagements and commitments like a never ending whirlwind. Though there is still much to be done on the issues surrounding CSR, the little that has been done has been seen to be very productive and has impacted to a great deal on the buying decisions and behaviors of consumers on both products and services of the sector in the oil and gas industry and has yielded much profit for the companies with better brand images in the eyes of the people.

In project management, resource leveling is defined by A Guide to the Project Management Body of Knowledge (PMBOK Guide) as "A technique in which start and finish dates are adjusted based on resource constraints with the goal of balancing demand for resources with the available supply."[1]


When performing project planning activities, the manager will attempt to schedule certain tasks simultaneously. When more resources such as machines or people are needed than are available, or perhaps a specific person is needed in both tasks, the tasks will have to be rescheduled concurrently or even sequentially to manage the constraint. Project planning resource leveling is the process of resolving these conflicts. It can also be used to balance the workload of primary resources over the course of the project[s], usually at the expense of one of the traditional triple constraints (time, cost, scope).

When using specially designed project software, leveling typically means resolving conflicts or over allocations in the project plan by allowing the software to calculate delays and update tasks automatically. Project management software leveling requires delaying tasks until resources are available. In more complex environments, resources could be allocated across multiple, concurrent projects thus requiring the process of resource leveling to be performed at company level.

In either definition, leveling could result in a later project finish date if the tasks affected are in the critical path.

Resource leveling is also useful in the world of maintenance management. Many organizations have maintenance backlogs. These backlogs consist of work orders. In a "planned state" these work orders have estimates such as 2 electricians for 8 hours. These work orders have other attributes such as report date, priority, asset operational requirements, and safety concerns. These same organizations have a need to create weekly schedules. Resource-leveling can take the "work demand" and balance it against the resource pool availability for the given week. The goal is to create this weekly schedule in advance of performing the work. Without resource-leveling the organization (planner, scheduler, supervisor) is most likely performing subjective selection. For the most part, when it comes to maintenance scheduling, there is less, if any, task interdependence, and therefore less need to calculate critical path and total float.

In this paper we argue that the use of the communicative theory of Jürgen Habermas in planning theory is problematic because it hampers an understanding of how power shapes planning. We posit an alternative approach based on the power analytics of Michel Foucault which focuses on ‘what is actually done’, as opposed to Habermas’s focus on ‘what should be done’. We discuss how the Foucauldian stance problematises planning, asking difficult questions about the treatment of legitimacy, rationality, knowledge and spatiality. We conclude that Foucault offers a type of analytic planning theory which offers better prospects than does Habermas for those interested in understanding and bringing about democratic social change through planning.

Project financing is the most veritable financial model that can be engaged in rapid infrastructure and large Engineering development in developing countries. In Nigeria the application of the model has to contend with some risks ranging form political risk, financial risk, environmental risk and risk that has to do with the development and performance of the project in question. Adequate planning and a careful analysis of likelihood risk can lead to steps that can be taken to mitigate them. Seasoned consultants should also be engaged right from the initiation point to the completion of the project.

To cite: Propersi, A., Gundes, S. (2006) Project Finance and hydropower projects: Case study of Birecik dam and hydroelectric power plant project in Turkey, Joint 2006 CIB Working Commissions W065/W055/W086 International Symposium Proceedings, Construction in the XXI Century: Local and Global Challenges, p. 268-269, Rome, Italy, 18-20 Oct.

Abstract
Build-Operate-Transfer (BOT) hydropower projects are long-term investments that involve complex organisational structures. Infrastructure projects procured via concession contracts face certain problems especially for international projects. However, in addition, hydroelectrical power projects pose particular difficulties due to
their capital intensive nature, high construction and hydrological risk, and associated environmental concerns. Combined with specific issues related to BOT model, the implementation of such projects become more complex for the parties involved. This paper aims to introduce Birecik Dam and Hydroelectric Power Plant which is the first major hydroelectric power plant realised on a BOT basis in Turkey. Birecik Power Plant comprises 6 units of 112 MW nominal capacity and the purpose is to provide power generation and irrigation. Birecik is an important project both for its size and for its complex organisational structure involving various international participants. In this concept, the challenges related to the implementation of BOT model, the way these problems are dealt by participants, principles of economical, financial and technical evaluation, total investment cost and project schedule, social and environmental sensitivities, relationships between unpredictable quantity of output and offtake agreement, project risks (public - private risk allocation), and financial structures will be analysed and strategies for to overcome these obstacles will be recommended.
Keywords: BOT, hydroelectric power plants, case reports, Turkey

This article presents results from the first statistically significant study of cost escalation in transportation infrastructure projects. Based on a sample of 258 transportation infrastructure projects worth US$90 billion and representing different project types, geographical regions, and historical periods, it is found with overwhelming statistical significance that the cost estimates used to decide whether such projects should be built are highly and systematically misleading. Underestimation cannot be explained by error and is best explained by strategic misrepresentation, that is, lying. The policy implications are clear: legislators, administrators, investors, media representatives, and members of the public who value honest numbers should not trust cost estimates and cost-benefit analyses produced by project promoters and their analysts.

The paper discusses the main challenges and opportunities for attracting both private domestic and foreign capital to foster the growth of concessions projects in the infrastructure sector, and proposes solutions from the Brazilian recent experience and other emerging economies. Given the exhaustion of the public funding sources in Brazil and the increasing demand for finance in the infrastructure sector in the coming decades, there is a consensus on the need of attracting private capital so to ensure the viability of the various concession projects planned for the period. We shall propose a new model for concession financing with provisions for demand risk to be shared between the Government and the concessionaire in order to increase participation of private capital in these projects. The model may also include currency hedge instruments in order to increase its attractiveness to foreign investors.

The paper examines the BOT (build-operate-transfer) projects as a viable model of public-private partnership. Its purpose is to reveal their conceptual framework, evolution, modern interpretations and implementation benefits. In view of the current economic realities of global financial deficit there are budget constraints at all levels of government in every country. The BOT projects can be considered as an alternative strategy for solving the financial and social problems of each government. They are a popular instrument of modernizing the transport infrastructure, energy sector, telecommunications, water supply, preserving of environment, etc.
Key words: BOT projects, build-operate-transfer, concessions, project finance, infrastructure

The Strategy & Mechanism  are designed by The Investor to act as an “Angel Investor”; This Mechanism has adopted  the concept of typical seed and venture capital but with the implementation of “FINANCIAL Risk Mitigation Strategy", where, the “Valley of Death” which is “built-into” the typical SC & VC can be avoided so that the risk from project’s financial performance deficiency will NOT directly affecting the Cash Collateral involved.

Project financing is the most veritable financial model that can be engaged in rapid infrastructureand large Engineering development in developing countries. In Nigeria the application of the model has to contend with some risks ranging form political risk, financial risk, environmental risk and risk that has to do with thedevelopment and performance of the project in question. Adequate planning and a careful analysis of likelihood risk can lead to steps that can be taken to mitigate them.

The study has been conducted for gaining practical knowledge about working capital management &activities of Travancore Cochin Chemicals Ltd. Investment in fixed  asses only is not sufficient to run the business. working capital or investment in current assets, however small it is, is a must for purchase of raw materials, and for meeting the day to day expenditure on salaries, wages, rents, advertising etc., and for maintaining the fixed assets. Working capital is just like a heart of industry if it weak, the business cannot prosper and survive, although there is a large body of fixed assets.

This is to certify that MR PRATHAMESH V. PATIL student of BMS-V th semester has completed his project on "IMPACT OF FDI ON RETAIL SECTOR IN INDIA" and has submitted a satisfactory report as per the requirement of university of Mumbai , in partial fulfillment of B.M.S course in the academic year 2013-2014.\

ABSTRACT
The Principle objective of this project was to establish the major causes of delays in projects implementation in the construction industry in Kenya. The study delimited itself my limiting the scope into the roads maintained /constructed by the KeNHA in the coast region of Kenya. This was deeply looked at by taking into account four major objectives that included: to establish the extent to which construction project financing influence the delay of construction projects in the road sector, to investigate the extent to which construction project planning influence the delay of construction projects in the road sector, to find out the extent to which contractor’s experience influences the delay of construction projects in the road sector, and ,to investigate the extent to which supervision of work influences the delay of construction projects in the road sector. The study employed a survey research design, since it was an in depth investigation of an individual group of respondents. The questioners were used as the main source of gathering information from selected 55 respondents that cut a cross categories like constrictors, surveyors, engineers and many more. These questionnaires were emailed to some respondents; others were dropped and picked later while some were administered by research assistants. Questionnaires were sorted out, data keyed in into the SPSS for analysis. This information then was presented by use of frequency tables. From the hypothesis testing using the Chi-Square, the calculated Chi-Square values were found to be greater than the critical value of 9.488 thus the alternative hypotheses were adopted in all the four cases as per the objectives. Recommendations for further studies have been included in the last chapter (chapter five).

This study examines factors affecting power distance in Singapore construction organizations. Knowledge of power distance enables project managers to implement measures to influence it towards higher productivity.
A survey was carried out on 104 middle-level employees from consulting firms, contracting firms, and government institutions. Factor analysis employing orthogonal (VARIMAX) rotation generated 12 factors grouped under four headings: (1) employees’ value systems, (2) seniority, (3) cultural background, and (4) perceived organizational climate. Organizational climate dimensions do influence power distance and they may affect employees’ organizational commitment and overall organizational performance. An employee-centred approach taken by project managers to involve and allow participation of employees in decision making could be the key response in narrowing existing power distance.

This article presents the theoretical and methodological considerations behind a research method which the author calls ‘phronetic planning research’. Such research sets out to answer four questions of power and values for specific instances of planning: (1) Where are we going with planning? (2) Who gains and who loses, and by which mechanisms of power? (3) Is this development desirable? (4) What, if anything, should we do about it? A central task of phronetic planning research is to provide concrete examples and detailed narratives of the ways in which power and values work in planning and with what consequences to whom, and to suggest how relations of power and values could be changed to work with other consequences. Insofar as planning situations become clear, they are clarified by detailed stories of who is doing what to whom. Clarifications of that kind are a principal concern for phronetic planning research and provide the main link to praxis.

With the dramatic plunge in oil prices, school and business shutdowns and increased concern around the impact of COVID-19 (coronavirus), the need for project financiers and borrowers to consider the implications under their finance documents has become even more pressing. COVID-19 is spreading fast across the globe. At the time of writing, the WHO reported cases of COVID19 in 206 countries with the tragic deaths of people. Since 31 December 2019 and as of 15 April 2020, 1 948 511 cases of COVID-19 (in accordance with the applied case definitions and testing strategies in the affected countries) have been reported, including 125966 deaths. The primary focus is necessarily on containment, treating the ill and helping communities cope with the epidemic. Our illustrative scenarios indicate that the potential loss of income in affected countries could be significant, with global GDP declining by up to 3.9%, and developing countries hit the hardest (4% on average, but some over 6.5%). Governments will need to offer significant support to affected businesses and households. In the context of a project finance transaction, the interruption of construction or operations can have significant implications. The project company is typically a thinly capitalized special purpose vehicle and lenders have limited or no recourse to sponsors in circumstances where the project is underperforming. In this note we consider some of the issues under the finance documents for typical project finance transactions. Most facility agreements contain information undertakings with which borrowers need to ensure they comply. The scope of the undertakings will vary across different facilities, projects and sectors, but they are likely to be most extensive during the construction phase of a project. Borrowers will need to consider whether any of these undertakings have been triggered by the COVID-19 outbreak and its impact on the project. Many transactions will also give lenders the right to ask for information and so borrowers will need to ensure that they respond to any such requests within appropriate time limits.

This handbook presents the current state of practice, method and understanding in the field of mathematical finance. Every chapter has been written by leading researchers and each starts by briefly surveying the existing results for a given topic, then discusses more recent results and, finally, points out open problems with an indication of what needs to be done in order to solve them. The primary audiences for the book are doctoral students, researchers and practitioners who already have some basic knowledge of mathematical finance. In sum, this is a comprehensive reference work for mathematical finance and will be indispensable to readers who need to find a quick introduction or reference to a specific topic, leading all the way to cutting edge material.

The coronavirus pandemic continues to take its toll on the African continent. While the continent as a whole still accounts for relatively few deaths from the disease, the numbers are rising, with more than 4,700 confirmed cases and 127 deaths. As countries scramble to contain the virus and are affected by the efforts of other countries to do the same the economic impacts grow. Even before the outbreak, the outlook for the world economy and especially developing countries like Nigeria was fragile, as global GDP growth was estimated to be only 2.5 percent in 2020. While many developing countries have recorded relatively fewer cases, Nigeria currently has 238 confirmed cases and 5 deaths as of this writing, the weak capacity of health care systems in these countries is likely to exacerbate the pandemic and its impact on their financial economies.

Megaproject Planning and Management: Essential Readings contains the seminal articles from the growing body of research on megaproject planning and management along with an original introduction by the editor, Bent Flyvbjerg. The leading and most cited authority in the field, Flyvbjerg has used crowdsourcing and 25 years of experience to cherry-pick from several hundred articles and books the writings that define the field. This volume will be an indispensable source for those wishing to speak with authority about how megaprojects are prepared, delivered, and fought over. The target audience is students, academics, practitioners, and media pundits alike, as well as communities affected by megaprojects.