Stakeholders in Sustainable Project Finance
Keys for Understanding them
Project Sponsors are those companies, agencies, or individuals who:
- have the idea and promote a project;
- bring together the required parties to get the project underway;
- obtain the necessary permits from the various agencies in the relevant jurisdiction;
- are investors in the equity of the project company; and
- provide support to the project company in a variety of ways.
Lenders are financial institutions that provide loans (debt financing) for the construction and initial operation of the project:
- Lenders may be commercial banks, saving banks, savings and loan associations, credit unions, multilateral banks, or export credit agencies.
- Depending on the size and risks of the project they can be either a single lender or a syndicated group of lenders.
Project Finance Facilitator
Project Finance Facilitators are specialized consultancy companies providing support to the Project Sponsor to reach the Financial Close with the Lenders.
- These firms fill the gaps of the Project Sponsor in preparing the Project Finance documents and in coordinating the different parties providing input to those documents.
- Their scope is more or less extensive depending on both the experience of the Project Sponsor and its willingness to participate in the development and project management.
- Based on the above, Project Finance Facilitators may play from a marginal role to acting as Project Managers of the Project Finance on behalf of the Project Sponsor.
Project Finance Stakeholders
- Project Sponsor who invest in equity
- Equity Investors
- Off-Takers who receive the product
- Lenders who lend the funds
- Multilateral Agencies and Export Credit Agencies who also lend funds
- Project Finance Facilitators
- Legal Advisors
- Technical Advisors
- Financial Advisors
- Regulatory Agencies who grant the permits and licenses
- EPC or Construction Contractors who may engineer, procure and construct
- Equipment Suppliers
- Insurance Providers
- Hedge Providers
- Operator who will operate the facility once constructed
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