This hugely successful Academy is a comprehensive 10-day training course that examines advanced techniques relevant to the current stressed global financial markets and enhances your 'sector' skills (Oil, Gas, LNG, Power, Mining and Infrastructure).
Although we recommend attending the full 10-day for maximum benefit, the modules are separately bookable so you can pick and choose the days that are most relevant to you. The Academy has been designed with Asia-Pacific in mind but the concepts are applicable to any region and the case studies used are global.
View our 60 Second Interview with the Course Director - Richard Tinsley
We took the opportunity to ask our expert Course Director a few questions on the current market challenges and how he became involved in this exciting industry. This is what he had to say. This is what he had to say.
M1: Advanced Project Finance (21-23 October 2013)
M2: Oil, Gas and LNG Project Finance (24 October 2013)
M3: Power Project Finance (25 October 2013)
M4: Mining Project Finance (28 October 2013)
M5: Infrastructure Project Finance (29 October 2013)
M6: Public-Private Project Finance (30 October 2013)
M7: Project Finance Risk & Recovery (31 October 2013 - 1 November 2013)
The Academy begins with a 3-day Advanced Project Finance Workshop focusing on the core skills of risk analysis and structuring, with a special emphasis on political risk.
The next four modules teach up-to-date sectors skills in some of today’s hottest industries:
Oil, Gas and LNG Project Finance (1 day), Power Project Finance (1 day), Mining Project Finance (1 day) and Infrastructure Project Finance (1 day). Industry fundamentals are covered together with the key metrics and due diligence alongside case studies and international best practices.
This is followed by a 1-day workshop on the application of Project Finance for Public-Private Programmes (PPPs) with a special session on which PPP programmes work and which do not.
The final module, Project Finance Risk & Recovery (2 days), examines projects that have gone wrong, including a review of credit factors and incorrect project assumptions.
All modules are highly interactive with many case studies and recent examples used throughout. Attending the full 10-day Academy means you will leave the course with a thorough understanding of Project Finance techniques and sector skills that can be applied immediately to your job.
Note: Delegates to bring laptops. The bidding competition is two-people-to-one-laptop using the course model PF Final.
Who should attend
- Bankers/Investment Bankers
- Project Financiers
- Financial Advisors
- Financial Analysts
- Accountants/Taxation Advisers
- Insurance Advisers/Brokers
- Project Lawyers
- Sponsors/Project Joint Venturers
- Business Developers
- Government/PPP Agencies
- Export-Credit Agencies
- Multilateral Agencies
- Relationship Officers
- M&A/Buyout Specialists
- Company Treasurers/Directors
- Credit Committee Staff
- Rating Agencies
- Project Managers/Engineers/Consultants
- Investment/Portfolio Managers
All Modules can be booked separately. Group discounts are available.
To register on the full 10-day Project Finance Academy, please select 'Register' and follow the registration process. If you would like to register on an individual Module, please select your desired module above and follow the registration process on this product page.
Please note we cannot process multiple module registrations online. If you wish to attend more than one Module but not the whole 10-day Academy, then please download a PDF and either fax this back to us on +852 2866 7340 or email a scanned copy to email@example.com. You can also email us your registration details and one of our account managers will register your place for you.
Advanced Project Finance
Hot buttons in project finance
Best sectors and project types
- Sectors to avoid
- Which trends are current?
Project finance vs. Balancesheet finance?
- Sponsor's rationale
- Lender's criteria
- Constructor's objectives
- Government's role(s)
Stages in project finance
- Time, team, costs
- Credit approval/information memorandum
Case study and modelling assignments:
- Tollway - banks/bond
- 144A power project
- Oil & gas - political risk
- Infrastructure complex - bond
Credit analysis case study:
- Impact of leverage
- Calculations for global coverage ratios
- Calculate liquidated damages/overrun/retention requirements
- How to choose sensitivities
- Key ratio targets
- Contrast to sponsors' IRR, NPV, valuation analysis
How to determine the correct structure for each risk
- The 7 risk systems
- The 16 risks to identify
- The 81 structures to apply
- Force majeure
- Foreign exchange
Funding and documentation Funding sources
- Local currency
- Credit wraps
- Preference capital
- IPOs/floats for projects
- Capital markets
- Leasing/leveraged leasing
- Export-credit agencies
- Multilateral agencies
Ratings for project financings
- How to get one from Moodys, Standard & Poors and Fitch
- Concession Agreements/BOO/BOOT
- Special purpose vehicles (the 6 types)
- Operations and Management (O&M) contracts
- Turnkey construction contract
- Delayed completion and systems performance insurances
- Offtake/sales contracts
- Support agreements/direct agreements
- Indirect supports/comfort letters
- Government guarantees
- Loan agreements
- Joint venture/shareholder agreement
- Security documentation
- Assignment of Contracts/Insurances
- Offshore proceeds account
- Information memorandum
- How to scope the review
- Independence of the reviewer
- Fit to credit approval/compliance
- The "bankable" feasibility study
Role of the advisor(s)
- When to involve advisors
- How to keep the costs down
Political risk and case presentations
Political risk structuring
- Terrorist questionnaire
- The classic three - expropriation; war; inconvertibility
- 21 political-risk categories
- Export-credit agencies/bilateral agencies and tactics for approaching them
- KfW-Ipex/Hermes, Germany
- ECGD, UK
- EDC, Canada
- JBIC/NEXI, Japan
- US Eximbank/OPIC, USA
- SACE, Italy
- Sinosure, China
- EFIC, Australia
- Multilateral agencies and how to approach them
- World Bank
- Multilateral Investment Guarantee Agency (MIGA)
- International Finance Corp (IFC)
- Asian Development Bank (ADB)
- European Bank for Reconstruction & Development (EBRD)
Each team presents its allocated case with structures and solutions as well as cashflow sensitivities.
Feedback is given on the teams presentation of the deal architecture, risks, and financial sensitivities.
- Project finance as a competitive tool
- Integrating project financing into the bid
- Contract/tender bidding
- "Real" turnkey construction contracts
- New horizons for projects and funding sources
- "Green" funds
- Emerging-market funds
- Tax structures
- Performance insurances
- Infrastructure/development funds
- Capital markets (wraps, partial risk, credit guarantees)
- Islamic project finance
- Credit derivatives
Note: The pre-course pack/CD includes the project finance risks chapter and the team cases and cashflow models.
Oil, Gas and LNG Project Finance
Petroleum project financing
- Field development (upstream)
- Platforms/production facilities
- Pipelines/oil terminals
- Coal-seam gas/coal-bed methane/fraccing
Cashflow for oil, gas, LNG and refining
- Converting reservoir engineering and other 15 risks into cash flows
- Reserve tail/PV loan life ratios
Case study: LNG Train F
A trustee-borrowing structure SPV works for this style of deal. Why?
- Seismic studies
- 'Proven' vs. 'Probable' reserves
- Production aspects
Special petroleum-industry project-finance structures
- Production payments
- Throughput agreements
- Royalty trusts
How to fund high-leverage pipeline infrastructure in capital markets and cover political risk.
How far can a borrower push a throughput agreement?
Sasol Gas Pipeline
Field facilities enhance the projects cashflows.
First International Petroleum Transport
Shell spins off six tankers onto the capital markets, firstly as a private placement; then as a public issue.
Floating-Production-Storage-Offloading (FPSOs) Vessels
Novel financing techniques.
Ras Laffan LNG
The worlds largest PF bond issue at the time.
Talk about 'mega'. This deal blows them all away! Examine the sponsors loan tranche.
This deal would not have succeeded without BP's sub-debt tranche.
Power Project Finance
Power industry risk analysis
- Technology and costs: Cogen, Cocycle
- Heat Rates
- Maintenance reserves
- Fuel costs
- Stages in power financing
- Concession/power purchaser
Tejo Energia (Pego), Portugal
How can banks take 30-year risk on a 12-year deal? What is a cash sweep?
Sinosure did a project finance deal on its own. Why this coal?
- Coverage calculations
- Reserve accounts
- Liquidated damages
Case study: Petropower
How could such a 'beside-the-fence' project attract 100% LDs?
Renewable energy projects
Merchant power plants
Price fuel = f(Price electricity)
Price gas = f(Market)/reset
Energy conversion agreement
How was 'deemed dispatch' handled? What is the subordination structure?
Overcome the difficulties in fitting wind into the grid and the complexities of the renewables payment regimes.
How can the fuel supply be co-financed with the power plant?
Mining Project Finance
Which commodities to project finance?
Stages in financing
Credit analysis criteria
- Economic rent
- Capital Markets
How can banks provide a rehabilitation guarantee to shut the mine down?
How to structure sales contracts to support a project financing.
How do the capital markets judge a monetisation of coal-supply contracts?
Reserves due diligence
- Why are mining due diligence approaches not as good as the power sector?
- Ore reserve codes dissected
- Estimation short-cuts
- Commodity swaps
- Commodity-linked bonds
Classic gold-mine receivables financing based on a 5-year reserve.
Iduapriem Gold Mine, Ghana
How the gold fee works? Can subordinated debt work in a gold loan?
How mine project finance can go wrong
How to use capital markets for development capital?
International Coal Financings
How banks lost US$1 billion on market risk?
Political risk structures in mining
Deal-of-the-Year; a blockbuster assembly.
KfW-Ipex, US Exim, and JBIC, plus the sponsors subordinated debt.
How to fit OPIC, MIGA, and EBRD together with a project financing?
Papua New Guinea
Examine political-risk structures for all mining projects, including Lihir.
Project finance without the banks
Combination of mezzanine debt and project finance within a commercial political risk package (not ECAs). Also wraps in some equipment-lease financing.
Infrastructure Project Finance
Risk allocation for each sector
Sectors of interest
- Social services
- Government/military services
- Due diligence
- Urban mass transit
What the banks did to flawed traffic studies?
Why this could never be a true PF deal.
What is the BEE aspect?
How much of a real estate component should be counted? Are the interchanges and corridor developments bankable?
Laem Chabang Port
How can banks achieve a full market-risk on such a project financing? How can FX risks be packaged? Are there technology aspects in the project forecasts?
Chengdu No.6 Water
Chinas first water supply BOOT with the imaginative structuring of EIB.
Why is the airside component backwards?
- Tender conditions
- Delay/completion architecture
- PPP Special-Purpose-Vehicles (SPVs)
Public-Private Project Finance
The fit of PF to the PPP spectrum of 8
- BOO (and variants)
- BOT (and variants)
- Management contracts
- Service contracts
- Supply contracts
PPP sectors and project types
- Power and power infrastructure
- Transport infrastructure
- Social infrastructure
- Public/military infrastructure
PPP processes and stages/timing
- Policy formulation
- International comparisons
- Competition policy
- Role of the regulator
- Unsolicited projects
The 18 pillars of successful PPPprograms
Role of the Government PPP Unit
Does the One-Stop-Shop really work?
What policies and procedures are needed?
What is the interface with local authorities?
Philippines BOT Law
Why has this simple Act spawned sufficient private-sector investment?
PICKO-PIMAC/KDI, South Korea
Korea set in place probably the most aggressive government co-spend.
What new policies and strategies are developed? Lessons?
Why the tender overturned them?
- Logic diagrams
- Four-by matrices
- Who takes what risk?
World's best practices
Why is this the simplest output specification in the world? How does an Annuity Payment work? Tolled vs.Untolled? The right of substitution?
How did Value Engineering contribute?
Tactics to maximise return/value?
Penang Bridge (OMT)
Funded by Islamic bonds, the government retains the right to renationalise it.
It is so successful that prisoners re-offend to avoid getting transferred there!
Mildura Base Hospital
Why was the preferred consortium 'fired' during the last-minute negotiations?
Supported Debt Model (SDM) Schools
Why was the SDM tried on this package?
What was the sponsors' resultant funding structure?
Project Finance Risk & Recovery
- The 8 options (and structuring solutions)
- Avoidance, deferral, reduction, retention, transfer, sharing, limitation, mitigation
BOO Cogen, USA
Why the first 144A project-financed bond deal default was in the USA.
Why does Motorola consider it a success! What market-risk pointers were evident?
Why did the144A project-financed bond market proceed?
Why did the French banks support an airport-city link when urban mass-transit traffic PF history is so appalling?
Two types of project finance
- Type 1: Sponsor support/completion test
- Type 2: Contractors' package
- Upside limits/liquidated damages/delay-in-startup
Project finance as an option
- The 3 phases of project finance
East Kemptville, Canada
The company signalled to its bankers that it might "take a walk" and it did.
Techniques of risk assessment
The seven (7) risk systems
- Risk management
- Project finance
Identify when a support will never work.
Lihir, Papua New Guinea
How a company spending $148 million for a feasibility study encounter repayment problems for technical reasons?
Victoria Hospitals Cogen, Australia
How the risk-management study identified grid weaknesses.
Basel II Bank capital adequacy and scoring
- The Big Four Banks - Results
- Internal Ratings Based (IRB) System
- Value-at-Risk (VaR)
- Soft systems methodology
- Country/sovereign risk
Project finance modelling
- Base Case
- Downside Cases
- Breakeven Cases
- Upside Case
See how quickly this project (almost) defaulted. What could the banks do?
Risk management Structuring
Optus Cable Roll-out
See how the primary-secondary circles work in structuring this project.
Corex, South Africa
Why Voest Alpine had to pay $180 million to correct the completion problems.
- Portfolio profile
- Credit risk
- Country limits
- Sector risks
Why did banks finance these projects knowing they could create pollution?
Why can the bond markets sometimes take environmental risk?
Role of the credit/investment committee
- Credit scoring
- Loan compliance
- Approvals matrices
- Pre-committee screening process
The Rule of 3
Western Harbour Crossing
Why did this carefully-controlled structure fail?
How did banks commit to a company selling services for less than it cost?
The 7 main tools
- Cascading covenants
- Audit/expert review
- Liquidity management
- Litigation trail
The FA technology (GE) was a technology risk. How much LDs were needed?
Role of lawyers
- Actions upon Default
- Cross-border considerations
- SPV management
Legal states of play
- Informal insolvency
- Project financier
- Team composition
- Credit committee
- Workout/Special loans division
- New monies
- Preparation for sale
- Risk ranking
- Building in hazards into the forecasts/Scenarios
The flexibility developed from backcasting and 'bottom-fishing' saved the day.
- Partial risk
- Completion enhancement
- Combination packages
- Sequential structures
Loy Yang, Australia
How did Chase repackage this mis-priced deal?
The international and sector approach taken on emerging-markets projectfinanced CLO in the PF bond market.
The eight (8) common threads