Introductory guide to project finance
Published by a LexisNexis Banking & Finance expert
Practice notesIntroductory guide to project finance
Published by a LexisNexis Banking & Finance expert
Practice notes
This Practice Note sets out a basic introduction to project finance focusing on:
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Due diligence and ‘bankability’
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sources of finance for projects
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project risks and Allocation
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types of project
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the main project parties
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the finance parties
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key finance documents
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key finance terms
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key project documents
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security and quasi-security in project finance transactions
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renewable energy
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PFI/PPP projects and procurement
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the Equator Principles, and
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green bonds
Key features of project finance
The term ‘project finance’ generally refers to the debt element of the funding for a project.
The ‘project’ commonly involves:
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constructing and/or operating something tangible like a road, bridge or a school, or
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exploiting something tangible like gas, oil or gold
The Basel II: International Convergence of Capital Measurement and Capital Standards framework (Basel II) defines project finance as:
‘a method of funding in which the lender looks primarily to the revenues generated by a single project, both as the source of repayment and as security for the exposure.’
It
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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Due diligence definition
What does Due diligence mean?
Due diligence means that all reasonable precautions were taken and all due diligence was exercised to avoid the commission of the offence. This requires the defendant to produce evidence of the system and procedures it has devised in an effort to avoid unfair practices.
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