The project finance diligence pack, item by item

Feasibility study

The purpose is to establish that the project is technically deliverable at the stated cost, in the stated place, within the stated time. An independent author is worth the fee, because a sponsor-authored study is discounted by every credit committee.

Costed budget and financial model

The budget lists what will be spent and on what evidence — quotations, tender returns, benchmark rates. The model turns that into a cash-flow forecast with revenue, operating cost, tax, debt service and cover ratios.

The model should be a live spreadsheet with visible formulas, not a printed summary, and it must contain a downside case. Reviewers routinely flex revenue down and cost up; supplying those cases yourself signals a sponsor who understands the risk.

Contracts

Three contract families carry the project: what is built (construction), who pays (offtake, concession or lease), and who runs it (operations and maintenance). Draft, executed or heads-of-terms status should be stated plainly for each.

• Construction / EPC contract with pricing basis and delay damages.
• Offtake, PPA, concession or lease agreements.
• Operations and maintenance agreement.
• Key supply contracts where inputs are critical.

Land, permits and clearances

Title or a long lease over the whole site, planning or development consent, sector licences and environmental and social clearance. Where an item is pending, give the application date, the authority and the expected determination — an accurate pending item is far better received than an overstated one.

Sponsor and corporate documents

Certificate of incorporation, shareholding structure, directors' identification, audited accounts where they exist, and a schedule of comparable projects the sponsor has delivered. Beneficial ownership must be traceable; unresolved ownership is a hard stop under our know-your-customer obligations.

Insurance

Construction all-risks and delay-in-start-up cover during the build, then property, business interruption and liability cover in operation. Lenders expect to be noted on the policies, and the insurance review is often the last item to close before drawdown.

The four avoidable delays

In our experience these account for most of the time lost between submission and offer.

• Cost figures that differ between the summary, the budget and the model.
• Permits described as held when they are applied for.
• A financial model supplied only as a PDF.
• Documents older than twelve months presented as current.