Project Project Finance

I’ve been doing some Project Finance work the past few days and find it to be quite interesting, if not very complicating. People often hear or read of large project finance deals going on somewhere in the world, but few know the number of parties and the amount of work that goes into making the deal work and making everyone satisfied. Essentially, project finance is the model used to help parties, many times  foreign governments, finance and build large infrastructure projects. As such, energy, whether natural gas, nuclear, hydroelectric, and oil, is often involved and thus there are a lot of regulatory approvals that go into it. The current deal I am working on is a energy plant in Canada that is being built. Large financial institutions provide the money as lenders, there is collateral put up to secure the deal, there are several institutions involved as various agents (usually banks) that play differnt roles on behalf of the entities borrowing the money (including our client), and there are way too many lawyers involved at each stage (of which I am one). Needless to say, there is a lot of documentation that each party must agree on. Given the speed at which things move now because of email, some items are bound to get lost or overlooked, which is what we have been cleaning up the past few days. These deals are important to everyone’s clients and are worth hundreds of millions of dollars and no one can afford to have things go wrong. And so the lawyers and the business people stay up all night getting the deal done. But for what? Sure, some large project will be completed eventually, but what good are we doing in the world? And is it worth the stress and sleep deprivation that so many people suffer from as a result? Who knows. But of the different types of deals that I have worked on, they seem to be more exciting (even if that is not saying a lot). Project finance is defintely better that structured finance, at least from my limited experience in both areas. But like so many other lawyers in New York City, this is somthing to do for now while we think of what we really want to do.  

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One Response

  1. makes the cause for good bloggin’.

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