Financing Large Projects: Using Project Finance Techniques and Practices [Paperback]

M. Fouzul Kabir Khan (Author), Robert J. Parra (Author)

Book Description

ISBN-10: 0131016342 | ISBN-13: 978-0131016347 | Publication Date: March 7, 2003

Financing Large Projects is one of the most comprehensive books written on the art of project finance. Project finance is a technique employed for the purpose of mobilizing capital for very large start-up projects, or greenfields, based on the cash flow merits of the project--usually with little or no external support provided by parent companies in the form of guarantees. Unlike other books, this one addresses the financial, technical, legal and environmental aspects of financing complex projects. In explaining the principles involved, the authors followed the project development cycle illustrating how projects are evolved from inception, usually through international competitive bidding, to financial closure when all debt and equity needed to construct and operate the project that has been mobilized.

The book is particularly thorough in explaining the criteria used by bankers and lawyers to distinguish projects that are bank-able from those that are not. It has some good sections, particularly apt for banking professionals, on the intricacies of international law as it impinges on project finance.

Editorial Reviews

Review

An excellent book and an up-to-date guide for the practitioner... -- Christopher K. Roberts, Partner, Allen & Overy

Financing Large Projects is a clear & thorough primer... -- Kenneth J. Arrow, Nobel Laureate and Professor of Economics (Emeritus), Stanford University

This informative book is an excellent resource for developers, bankers and ceding authorities. -- Paul T. Hanraban, President and CEO, AES Corporation

From the Publisher

Unique Features:

Offers a very strong focus on the financial model. Readers are introduced to the architecture of the typical (and even encouraged to construct a new) financial model. They are exposed to the changing role of a financial model during the project development and loan negotiation stages. Moreover, they would find the financial model useful for the purpose of monitoring and tracking the progress of the project during construction and operations.

Offers an extensive discussion on the different classes of debts.

The use of hedging instruments used in Project Finance and methodology are also discussed in the book.

Clearly brings out the discussion between Corporate and Project Finance. This book explains that Project Finance transactions are limited recourse financing with securities limited to cash flow and projects assets only.

See all Editorial Reviews

Product Details

• Paperback: 672 pages
• Publisher: Prentice Hall (March 7, 2003)
• Language: English
• ISBN-10: 0131016342
• ISBN-13: 978-0131016347
• Product Dimensions: 8.7 x 5.9 x 1.5 inches
• Shipping Weight: 2 pounds
• Average Customer Review: 4.0 out of 5 stars  See all reviews (2 customer reviews)
• Amazon Best Sellers Rank: #1,884,017 in Books (See Top 100 in Books)

Customer Reviews

Most Helpful Customer Reviews

26 of 28 people found the following review helpful:

5.0 out of 5 stars A Useful Primer for Infrastructure Project Finance Technique, March 29, 2003

By 

Rahat Jaman (Dhaka, Bangladesh) - See all my reviews

This review is from: Financing Large Projects: Using Project Finance Techniques and Practices (Paperback)

Financing Large Projects: Using Project Finance Techniques and Practices by Fouzul Khan, Robert Parra is a very useful primer for project finance practitioners.

This book focuses on the financing of large projects that rely on project finance techniques and practices in order to raise debt. Being in infrastructure financing industry over four (4) years, I faced a tremendous dearth of a good book covering infrastructure financing intricacies. The book has offered knowledge of my much needed felt areas.

The book integrates every essential aspects of issues relating to the financing of large projects, namely, financing, law, engineering, environmental, etc. It also has a detailed description on history of project finance along with origin and development of various instruments.

What a user shall find noteworthy about the book is that it covers different phases of project development, and attributes thereof. Starting from the project conception, the book goes on explaining project negotiation, appraisal, creation and perfection of security over project assets.

The first half of the book describes project origination and early development activities, negotiations with ceding authority and others of project agreements, sources of international finance and credit enhancements, and the sponsor's support required for classic and non-classic deals. The second half discusses the architecture of the typical financial model, due diligence and appraisal process conducted by lenders, scope and content of negotiations related to each of several finance documents, role of derivatives and hedges, and typical issues encountered in structuring a security package.

Finally, the book also appends a very useful project feasibility financial model, which could be customized for use in feasibility analysis of similar projects.

7 of 10 people found the following review helpful:

3.0 out of 5 stars Reasonable but an introduction only, October 25, 2005

By 

George D. Bayne (Victoria, Australia) - See all my reviews
(REAL NAME)   

Amazon Verified Purchase

This review is from: Financing Large Projects: Using Project Finance Techniques and Practices (Paperback)

The book is a reasonable introduction to project financing but falls short on many of the pratical details used in balancing risks, which is the essence of project financing.

I was keen to see how the book covered the financing of port projects and I found that the authors summarised a 1998 publication By Drewry shipping without adding any new insights. Indeed the 1998 publication provides more pratical benchmarks and financing options.