Project Finance

Introduction

Project Financing is a unique financing technique that has been used on many high-profile corporate projects, including Euro Disneyland and the Euro Tunnel. Employing a carefully engineered financing mix, it has long been used to fund large-scale natural resource projects, from pipelines and refineries to electric-generating facilities and hydroelectric projects. Increasingly, project financing is emerging as the preferred alternative to conventional methods of financing infrastructure and other large-scale projects worldwide.

Project Financing discipline includes understanding the rationale for project financing, how to prepare the financial plan, assess the risks, design the financing mix, and raise the funds. In addition, one must understand the cogent analyses of why some project financing plans have succeeded while others have failed. A knowledge-base is required regarding the design of contractual arrangements to support project financing; issues for the host government legislative provisions, public/private infrastructure partnerships, public/private financing structures; credit requirements of lenders, and how to determine the project's borrowing capacity; how to prepare cash flow projections and use them to measure expected rates of return; tax and accounting considerations; and analytical techniques to validate the project's feasibility.

Course objectives

The main objective of the course is to provide students with the necessary theoretical and conceptual tools for financial analyses and decision-making in relation to Project Finance. The elective is designed for students pursuing careers in the corporate sector in treasury, corporate finance or business development functions, those in investment banking, consulting or engineering, and those involved in debt or equity investment decisions. It is particularly appropriate for students with an interest in medium to large-scale investments or projects. The course is especially...