With the advent of independent power producers and merchant generators, project finance became a feature of energy capitalization. This approach has been used to fund many projects for which corporate finance has been a suboptimal source of capital. Even though the merchant markets are currently less appealing economically, this method of financing has proven relevant to a variety of situations: replacement of retiring older generators, new renewable projects, and more. Even established regulated utilities can find value in this approach for potential tax, cost of capital, and ring-fencing benefits.
Accordingly, an understanding of this method of financing has become essential to anyone involved in the funding of power and gas infrastructure investments. That's the driving force behind this new two-day interactive course. You'll get an in-depth explanation of project finance, both in the US and internationally. Through lectures, case studies, and hands-on exercises, you'll learn the ins and outs of project finance, the equity and project development considerations, and how to put it all together to build an actual structured transaction.
Throughout the course, an emphasis on risk identification, allocation and mitigation will be highlighted, from a project's conception, across its entire dynamic life cycle.
What You Will Learn
- The ability to identify the key commercial components necessary to structure a financeable project, from underlying contracts through to a detailed financial model
- A thorough understanding of the capital structure of a special purpose project finance vehicle, through in-depth review of equity and debt instruments
- Knowledge of the financial markets and associated market participants that are relevant to project finance
- An understanding of the key legal concepts associated with project finance, through assessment of the package of contractual agreements that underpin any financing arrangement
- The skills and knowledge in modeling, contracting, financing, and risk mitigation to build a structured transaction in a real-world case study
Your Instructor
Robert O. Gurman
Mr. Gurman is Principal of Gurman Capital Group, an independent financial advisor focused primarily on the project, infrastructure & structured finance sectors. There, Mr. Gurman has completed $7.5 billion of total transactions, comprised of transaction execution and advisory assignments on behalf of Astoria Energy, Starwood Energy Group, JEMB Realty Corp., IIFC, Monmouth Park, Trinity Solar, SNL Knowledge Center, Moody’s Analytics, Pocono Manor Investors, Weichert Enterprise, Garden State Solar Power, Rockland Capital, Megawatt Solar, and others. In addition, Mr. Gurman serves as Chief Financial Officer of Pocono Manor Investors, a real estate development firm. Mr. Gurman also serves as Managing Director and Chief Credit Officer of Mariner Infrastructure Investment Management, a fund being launched to provide first-loss capital protection to banks active in the global infrastructure sector.
Concurrently, Mr. Gurman is an Adjunct Professor at Johns Hopkins University-School of Advanced International Studies, with a dual appointment in the International Economics Department and the Energy, Resources & Environment Program, where he has developed and currently teaches a graduate- level course entitled “Principles of Project Finance.” This fits well with periodic assignments on behalf of SNL Knowledge Center, where he is developing and delivering a public course in project finance. Earlier in his career, Mr. Gurman served as Vice Director of Global Project Finance and as the Director of the US Credit Division for Swiss Bank Corporation (now UBS). There, Mr. Gurman developed Swiss Bank’s first global portfolio rating and MIS systems, ran the bank’s credit training program, and designed, implemented, and ran the bank’s global derivative credit limits system.
Mr. Gurman earned his B.A. in French Literature and Political Science from Union College, and his M.A. in International Energy Policy and Economics from Johns Hopkins University, School of Advanced International Studies. Additionally, Mr. Gurman has been appointed a Senior Advisor to the 2014 NY/NJ Super Bowl Host Committee, serves on the Boards of New York Says Thank You and Prospect Theater Company, is the founder and manager of the Swiss Bank Corporation Alumni Network, and is a Balloon Pilot for the Macy’s Thanksgiving Day Parade, in New York City.
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Seminar Agenda
Day One 7:45 am - Registration and Continental Breakfast Open
8:30 am - Introduction and Overview
9:00 am - What is Project Finance?
- Definition and contrast with corporate financeParticipants & commercial building blocks
- Risk identification, allocation & mitigation
- Importance of structure
- Examples of common applications
10:15 am - Break
10:30 am - Equity Considerations
- Project life cycle and dynamic risk profile
- How does the project’s profile and risks change over time?
12:00 pm - Lunch
1:00 pm - SNL Project Finance Product Uses Overview
1:30 pm - Project Development Considerations
- What factors affect the economics of a transaction?
- Overview of the technological and bureaucratic issues that influence development speed, success and value
- What are the supply chain considerations that must be considered in the project?
2:45 pm - Break
3:00 pm - Equity Considerations (continued)
- What governance structure makes the most sense?
- How will different parties be represented?
- What are the mechanisms available for dispute resolution?
- Liquidity, exit and sale rights
- Economics: cost of capital, IRR and cash-on-cash return, distributions, waterfalls, flip points, carried interest, taxes
5:00 pm - Day One Concludes
Day Two7:30 am - Continental Breakfast Opens
8:30 am - Turning Commercial Terms into a Financeable Project Profile
- What are the primary concerns of lenders?
- What are the essential financial inputs?
- Key financial model data points, assumptions, and sensitivities
- Financing strategies
10:00 am - Break
10:15 am - Turning Commercial Terms into a Financeable Project Profile (continued)
12:00 pm - Lunch
1:00 pm - Putting the Pieces Together: Case Study - Gas Fired Combined Cycle with a Tolling Arrangement
- Students will use the skills and knowledge they have acquired in modeling, contracting, financing, and risk mitigation to put together a structured transaction for a real-world gas fired combined cycle generator
2:45 pm - Break
3:00 pm - Case Study Debrief
4:00 pm - Program Concludes
Venue
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Who Should Attend this Seminar
Business/ Corporate Development, Financial Planning and Analysis, and Corporate Finance/ Treasury professionals at power and gas companies Professionals in investment banking, project finance, asset management, hedge funds, or equity/fixed income research Consultants, accountants and lawyers who advise power and gas clients on infrastructure projects,Current and potential suppliers or professionals looking for an understanding of how projects are structured in order to bolster their service offerings
Prerequisites and Advance PreparationParticipants will need to bring a laptop computer with access to Microsoft Excel and a calculator.
This fundamental level group live seminar has no prerequisites. No advance preparation is required before the seminar.
Program LevelBasic level. This fundamental course begins with basic material and then proceeds to the intermediate level.
Delivery MethodGroup-live.
Hotel and Seminar Information
This two-day seminar will be held at the hotel listed below. The seminar will start promptly at 8:00 AM and will finish at 5:00 PM on the first day. On the second day, the seminar will resume at 8:00 AM and will finish at 4:00 PM. Your registration includes all conference materials and continental breakfast and lunch on both days. Dress is business casual.
Downtown Conference Center157 William Street
New York, NY 10038
Telephone: (212) 618-6990
View Seminar Location WebsiteBecause of the diversity of hotels found in the area, We will not be holding a block of sleeping rooms with one particular hotel.
