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The rapidly evolving LNG trade is giving rise to unprecedented
capital expenditures in order to expand the global liquefaction,
shipping and regasification infrastructure. Individual gas-value-chain
investments can reach into the $billions, and, as a consequence,
project financing plays an increasingly crucial role, particularly
as second-tier participants enter the market.
Lending institutions and equity investors seek out the required
expertise to not only assess project economic and technical
feasibility, but also to provide essential due-diligence review
in support of investment decisions and project financing.
ZECG brings seasoned expertise in project feasibility, economic
and market analysis, reserves evaluation, technology assessment,
risk assessment, project/structured finance and other disciplines
that play a key part in the due-diligence process.
Providers of equity and debt capital must understand the
factors that influence the desirability of undertaking a given
project. This entails examination of the following:
- Reserves/assurance of gas supply
- Gas infrastructure
- Supply/demand drivers
- Macro trends in the gas value chain
- Commodity pricing forecasts
- Construction cost trends
- Equipment lead times and time to market
- Analysis of competing projects, routes to market and competitive
positioning
- Analysis of development sponsors' competitive strengths
and weaknesses
- In-country/project/market risks
Project risks are central to due-diligence review. Equity
investors and lenders must fully understand project risks.
Inflation risk, currency risk, political risk, market risk,
interest-rate risk, gas-supply risk and environmental risk
all play a part. A thorough due-diligence review must not
only examine these factors, but must go further to examine
viable/optimal mitigation strategies.
The principals and executive consultants at ZECG bring all
the required skill sets to provide the client with an understanding
of the risks and economic desirability of a specific investment. |
