what is project finance.ppt

International Project Finance Chapter 1 What is Project Finance * Lenders Project must be bankable (certain minimum requirements in relation to Concession Contract and other Project Documents) Objective: to get paid back Preserve the project asset – tight control over borrower and its assets International Project Finance Chapter 1 What is Project Finance * 3.1.6 The insurer International insurers National insurance companies with reinsurance Construction All Risk insurance (CAR) 建工一切险 Delay in start-up insurance (DSU) 延迟启用(保险) Business interruption insurance (BI) 业务中断保险 International Project Finance Chapter 1 What is Project Finance * 3.2 participants in many, but not all, Project Finance deals Off-taker-customer off-take agreement: minimum amount of product Fixed price well defined International Project Finance Chapter 1 What is Project Finance * Third-party operator who should operate and maintain the project-project manager one of the sponsors The third-party operator 3.2 participants in many, but not all, Project Finance deals International Project Finance Chapter 1 What is Project Finance * Resource supplier Government Central government Ceding authority 3.2 participants in many, but not all, Project Finance deals International Project Finance Chapter 1 What is Project Finance * The local government’s influence approval of the project, control of the state company that sponsors the project, responsibility for operating and environmental licenses, tax holidays, Supply guarantees, industry regulations or policies, providing operating concessions. International Project Finance Chapter 1 What is Project Finance * The objectives of the government To reduce or eliminate the need to use the government‘s own funds or borrowings To satisfy public interest and have project completed as soon as possible To transfer risk from public sector to private sector To bring project back into public ownership once the pr