The Miami Project Finance Academy: M3 - Cash Flow Modeling

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Cash Flow Modeling is module 3 of this 8 day course. This daylong session gives participants a handson opportunity to build a cash flow model for an LNG facility using Excelbased software. At the conclusion of the segment participants will have built a pro forma project model suitable for examining debt capacity and project return on investment Other Modules MODULE1: Advanced Finance Modeling Workshop (3 Days) MODULE 2: Financing Oil, Gas and Mining Projects (2 Days) MODULE 4: Power Projects Including Renewable Energy (1 Day) MODULE 5: Infrastructure Finance and PPP (1 Day) The next 3 modules teach up-to-date sectors skills in some of today’s hottest industries: Power Projects Including Rene…

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Didn't find what you were looking for? See also: Cash Flow, Renewable Energy, Debt, Business Finance, and Bookkeeping.

Cash Flow Modeling is module 3 of this 8 day course. This daylong session gives participants a handson opportunity to build a cash flow model for an LNG facility using Excelbased software. At the conclusion of the segment participants will have built a pro forma project model suitable for examining debt capacity and project return on investment Other Modules MODULE1: Advanced Finance Modeling Workshop (3 Days) MODULE 2: Financing Oil, Gas and Mining Projects (2 Days) MODULE 4: Power Projects Including Renewable Energy (1 Day) MODULE 5: Infrastructure Finance and PPP (1 Day) The next 3 modules teach up-to-date sectors skills in some of today’s hottest industries: Power Projects Including Renewable Energy,Infrastructure Finance and PPP. Industry fundamentals are covered together with the key metrics and due diligence alongside case studies and international best practices All modules are highly interactive with many case studies and recent examples used throughout. Attending the full 8-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. All Modules can be booked separately. Group discounts are available. To register on the full 8-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 8-day Academy, then please download a PDF and either call us on +1212-224-3460 or email us to training@euromoneyny.com. You can also email us your registration details and one of our account managers will register your place for you.
MODULE 1: Advanced Project Finance Workshop DAY 1 Structuring Projects and Creating a Security Package; In-depth Study of a Gas Processing Plant Project Finance Overview Current challenges /approaches Who are the players? Identifying and allocating risks What can go wrong? Examples from the energy sector Financing infrastructure Various Projects and Approaches to Risk Identification across Sectors Risks in development Construction and operating risks Feedstock and supply Market risks Environmental risks Financial risks Political and regulatory risks Sources of Finance: Financing Checklist Domestic and foreign banks Bond markets Development banks, ECA's and other official creditors Leasing Islamic finance Sources of equity Cashflow Forecasting Financial modeling and cash flow analysis View of lenders: DSCR and PV coverage Equity considerations: IRR and NPV Approaches to evaluating the cost of capital Project returns vs. equity returns Forecasting techniques and limitations Probabilistic vs. non-probabilistic model-building Case Study: Working With Cash Flow Modeling Software to Finance a Fertilizer Plant Participants break into small groups to prepare a case study that analyzes a fertilizer project. A computer simulation will be used to model cashflows. Groups will present their solutions. DAY 2 Documentation and Sources of Finance and Credit Enhancement; Financing Transportation Infrastructure Case Discussion Legal Issues and Documentation Legal environment and regulatory conditions Commercial points and legal points in various project structures: -Incorporated and unincorporated joint ventures -Partnerships and limited partnerships Key contractual agreements and structuring considerations Developing a term sheet -Limiting recourse -Tax gross up issues -Market disruption provisions -Reps and warranties -Conditions precedent -Covenants including MAC clauses -Hedging requirements Sources of Finance Banks and the current club loan market Syndicated loan financing What security do banks want? Market flex clauses "A" and "B" loans and other funding sources Inter-creditor Issues Credit Enhancement Alternatives Guarantees and insurance vs. funding Buyer and supplier credits Bank incentives inherent in ECA programs Costs and availability Securitization of ECA guarantees Choosing a special purpose vehicle Sector Considerations Ownership structure Outright and partial government ownership Long-term concessions and PPP structures like DBFO Privatization of seaports; airport financing Exercise: Constructing a Risk Matrix for a Transport Project Case Study: Airport Finance; Negotiating a Term Sheet Participants will break into groups to work on this PPP project structure. Discussion will focus on project risks, their allocation through contracts, the mix of financing, cash flow projections. Also, rating agency considerations in evaluating the proposed financing structure. DAY 3 More Financing Sources and Structuring Considerations; Conventional and Renewable Power Project Transactions Case Discussion Using Capital Markets for Projects Private placements and Eurobond issuance for projects Comparing bond issuance to bank loans -Nature of investors, timing and flexibility -Project size and relative cost -Security requirements -Negative arbitrage issues -Due diligence process / road shows -Rating agency considerations Leasing Applications Leasing applications in projects Evaluating cost Case Examples: Colombia and Brazil Interest Rate and Currency Price in Projects Financial price movements today: volatility and risk Using interest rate and currency swaps to manage risk in projects Options: caps, floors and collars Conventional and Renewable Power Projects Market forces and the effect on electrical supply Fragmentation of electricity generation Gencos/transcos/discos Merchant power plants (MPPs) Rating agencies' analytical model Case Study: Financing a Gas-fired Power Plant Risk allocation among various project participants in a gas-fired cogeneration electricity and water desalination plan. Testing the project's cash flows under varying scenarios with a cash-flow simulation model. What are acceptable DSCR levels? Equity returns? Self-test MODULE 2: Financing Oil, Gas and Mining Projects DAY 4 Natural Resources Projects Upstream, Midstream and Downstream Oil and Gas Structure: upstream, midstream and downstream Hydrocarbon basics: geology, reserves Supply and consumption Oil production: process depletion and enhanced recovery Financing structures: balance sheet vs. limited recourse -Field development and platform types -Production facilities -Building and financing pipelines -Refineries and petrochemical plants -LNG facilities Allocating Risk Technology and construction/completion Reservoir/reserve risks Feedstock risk Sales and off-take Operation and maintenance Abandonment/decommissioning Environmental/regulatory issues Country/political risk Logistics and Transportation Financing Logistics: pipelines, shipping, and storage Types of tankers -AFRA Classes (Average Freight Weight Assessment) -ULCC to Tanker Lightering Islamic Finance Definitions, principles, and authoritative sources Structures: Murabaha, Istisna and Ijara Examples of petrochemical and other transactions Case Study: Financing an Oil Rig Participants will break into small groups to prepare a case study concerned with equipment financing. A computer simulation will be used to model possible outcomes. Groups will present their solutions. DAY 5 Reserve and Off-take Evaluation; Mining Projects Stages in Financing Natural Resources Projects Exploration/ geology/drilling/reserve estimation Reserve-based lending and borrowing bases Mezzanine funding Oil and gas reserve categories (P1, P2, P3) Common measures: (Loan Life Cover Ratio (LLCR), Project Life Cover Ratio (PLCR), Reserve Tail Case Study: Financing a Condensate Field Development Project Evaluating the security package and forecast cash flows for a condensate field. Structuring approaches. finding funding. Mining Transaction Considerations Special Issues Single asset projects and asset depletion Off-take arrangements Construction issues and engineering Mine operating risk Environmental and country risk Commodity Price Volatility and Risk Management Commodity-linked derivatives and securities -Commodity swaps to manage risk Options: caps, floors and collars sage in projects Mining Case Study Structuring a sales contract to support project financing of industrial minerals project. 

Considering commodity price risk. Self-test MODULE 3: Cashflow Modeling DAY 6 Project Finance Modeling Participants will spend a day building a model for a Liquefied Natural Gas (LNG) project. They will test a limited-recourse financing package for debt capacity and attractiveness to investors. Discussion of common approaches to modeling with Excel, ‘dos’ and ‘don’ts’. Practical use of models for negotiations. Modeling Workshop Overview: Objectives and Approaches Constructing a model / common myths Variations by project type Overview of LNG plant and major contracts Structuring the Model and Organizing the Data to Create a Cashflow Statement Developing the assumptions page Construction costs and timing Operating cost, plant capacity usage, fixed and variable costs Reinvestment, plant expansion, productivity shifts Financing Section Equity first or pro rata Manually designed equity subscription Draw-down of debt linked to specific contracts, expenditures or in a hierarchy Developing the Profit and Loss and Balance Sheet Factoring in reserves Considering currencies Tax calculations Working capital Ratios and Sensitivity Analysis: Objectives and Limitations Measuring debt capacity and investor return Using modeling output for initial project vetting Supporting on-going negotiations MODULE 4: Power Projects Including Renewable Energy DAY 7 Energy Projects and Renewable Power Power Markets Global growth of the market Various types of power compared -Gas fired plans -Coal renewable energy projects and comparative costs -Wind powered electricity plants -Small-scale hydro plants -Landfill gas projects -Bio-mass and bio-fuels -Geothermal energy -Solar power Snapshot of global incentive programs designed to encourage renewable energy usage and investment (Europe, U.S., India, China) -Feed-in tariffs -Renewable portfolio standards and renewable energy credits -Depreciation, allowances, etc. Financing structures and players Risk Identification and Allocation in a Wind Project Financing: Different Approaches/Differing Risks from Conventional Power Project Finance Construction and warranty issues Technology advances Operational issues Transmission, interconnection and tariffing PPA considerations: availability, energy and environmental credits Solar Power Solar photovoltaic systems and solar thermal -Issues of scale, cost and application -Financing challenges and ppa solutions -Roof and ground leasing issues; other site requirements -Technology warranties Case Study: Financing a Solar Park Evaluating the security package for a Photovoltaic (PV) Solar Park. MODULE 5: Infrastructure Finance and PPP DAY 8 Infrastructure Projects, PPP, and Transportation What is a Public Private Partnership (PPP)? Public Private Partnerships (PPP) principles Roles for the public and private sector Different structures and degrees of private participation -Contract services: Operations and Maintenance (O&M), O&M and Management -Leasing, Lease Develop Operate (LDO), Lease Purchase, -Sale Leaseback -Design Build: DB, DBM, DBO, DBFO -BOT, BOO Concessions PPP Tender Process Specifying user needs in output terms Private sector informational requirements Identifying bidders and assessing risks negotiating strategies and closing Quantitative Risk Analysis and Cashflow Forecasts Requirements of creditors vs investors Other stakeholder considerations “Value for Money” and the Public Sector Comparator (PSC); Unitary Payments (UPs) Case Study: Financing a Tollroad/Reviewing a DBFO Term Sheet Participants will break into groups to evaluate the financing scheme for a toll road. They will assess the allocation of risks, and concession terms, and other contractual agreements. A cash flow model will be used to test qualitative assumptions. PPP and Social Infrastructure Financing hospitals, schools, prisons, others Sample concessions and contract terms Risk evaluation and allocation Monitoring requirements Self-test and Wrap-up
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