Structuring Process

The process to develop a project and the process to build a structure that provides a project with funds are like two sides of the same coin. This results from the following:

Fund providers and stakeholders that assume the risk concerning a project become elements that support the project, and credit is based on this framework. (This is based on the premise that all risks concerning a project and their interrelationships are recognized as a whole picture) There are various elements that constitute a project as given conditions and the structure of finance is designed premised on them. (Since the framework of fund contribution greatly affects financial viability and feasibility of a project, it will become insignificant unless finance structuring is taken into consideration in parallel when building a structure of the whole project)

In the framework of overall project and its time serial development, a structure that enables reasonable prediction of risk bearers and how to assume risks is established.

Finance is an indispensable element to achieve a project and a project is realized for the first time when the framework of finance is established.

In project schemes, details are examined for each contractual relationship that is assumed to be an element that structures a project, and as a result, a project profitability model is created, and based on this, phased and parallel actualization of each element is designed. Normally, this actualization is processed by controlling funds and costs to be injected within a certain time frame.

Figure 4-2-9 shows a logical process for creation of a project profitability model, designing its optimization and creation of its optimum framework by planning and examining each element that Part 4 Page 29

constitute a project under its basic design. Specifically, as a result of examining the following six elements, a temporary project profitability model is created and its optimization is planned in line with verification of the relationships between the elements and the whole project.

(1) Planning of technologies to be adopted, design and construction (EPC), and examination

(6) Examination of the detailed funding plan

(1) Planning of technologies to be adopted, design and construction (EPC), and examination

(2) Planning of income structure and market risk analysis, and examination

(6) Examination of the detailed funding plan

Temporary project profitability model

(2) Planning of income structure and market risk analysis, and examination

Temporary project profitability model

¿ Optimization of ¡„„^ Optimization of J elements • ¡ the whole project •

Examination of phased actualization í of individual elements "

¿ Optimization of ¡„„^ Optimization of J elements • ¡ the whole project •

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